Home News Ag Economics California Tree Nut Sector Well Positioned for Growth in Algerian Market

California Tree Nut Sector Well Positioned for Growth in Algerian Market

USDA Foreign Ag Service — The exporter guide provides an economic and market overview, as well as demographic trends and practical tips for U.S. exporters on Algeria. The report provides an overview of the three market sectors – food retail, food service, and food processing in Algeria. Overall, of the total U.S. agricultural exports to Algeria, consumer-oriented products represent 15 percent of the total U.S. exports in 2023. Tree Nuts currently have the best prospects for U.S. consumer-oriented products exported to Algeria.

Executive Summary: Algeria is a middle-income country and in 2022, its GDP reached almost $200 billion, positioning it as one of the largest economies on the African continent. Encompassing an area of 2,381,741 sq. km, Algeria is also the largest country in Africa by landmass. Algeria’s state-dominated economy is heavily dependent on oil and gas revenues, which historically have provided over 90 percent of export earnings and nearly 40 percent of state revenues. The agriculture sector is one of the priority sectors for the government in its efforts to diversify the economy and attract foreign and domestic investment outside the energy sector. The agriculture sector contributes on average 12percent of Algeria’s GDP and employs 20 percent of the population in rural areas. Algeria’s imports of agricultural commodities and food represented 25.29 percent ($9.9 billion) of total imports ($39.21 billion) in 2023.

Food Retail Industry: Algeria’s food retail sector is estimated at $37.5 billion and is highly fragmented. Consumers shop for bulk, packaged and high value products, both local and imported, in small, privately owned supermarkets called “superettes”. Algeria’s largest private-sector conglomerate Cevital, operates 23 grocery stores under the brand name UNO. International retail chain Carrefour is also present.

Food Processing Industry: The government divested itself from agricultural production and processing allowing the private sector to take the lead. The private sector is comprised of wheat and feed millers, dairy processors, vegetable oil refiners, sugar refiners, beverage producers as well as canners, and a pastry industry. The distribution and HRI sectors are growing however need further development.

Food Service Industry: Revenue in the food market amounts to $17.4 bn in 2024. The market is expected to grow annually by almost 10 percent (CAGR 2024-2028). The largest segment is the Confectionery & Snacks with a market volume of US$2.8 bn in 2024. In the Food market, 0.9 percent of total revenue will be generated through online sales by 2024. In the food market, volume is expected to amount to 5.75 bn kg by 2028. The food market is expected to show a volume growth of two percent in 2025. The average volume per person in the food market is expected to amount to 115 kg in 2024.

Section I: Market Overview

Algeria is a middle-income country whose state-dominated economy is heavily dependent on oil and gas revenues, which historically have provided over 90 percent of export earnings and nearly 40 percent of state revenues. These revenues have funded a generous social safety net through food, fuel, housing, health, and education subsidies. The World Bank estimates that Algeria’s GDP grew 4.1 percent in 2023, though inflation reached over 9.3 percent. In 2024, the World Bank expects GDP growth to slow due to stagnant oil and agricultural output, before rebounding in 2025. The IMF estimates the national economy at around $200 billion.

The government’s economic development plan centers on diversification away from the energy sector, with a particular focus on agriculture. Algeria leans on protectionist trade policies to encourage development of local industries and to control the current account deficit. The import substitution policies are often announced without warning, and tend to generate regulatory uncertainty, supply shortages, increased prices, and a limited selection for consumer goods. Nevertheless, food imports have been trending up sparked by growing consumer demand.

Food accounts for just over 40 percent of Algerian household spending, and mainly concerns relatively unprocessed basic products. The government subsidies staples such as sugar, soybean oil, bread, semolina and pasteurized milk which encourages high consumption of these products. In Algeria, generally, the price determines the consumption. Purchases are often made from small retailers even though supermarkets and shopping centers are growing. Since the Covid-19 pandemic and the war in Ukraine, inflation and price increases have negatively impacted consumer confidence.

Online commerce and restaurant take out is growing, especially since the Covid-19 pandemic, and consumers are increasingly attracted by easier and faster ways of buying. However, online payments are extremely limited; most consumers place the order online or via phone and pay in cash to the delivery driver. More than half of the population has internet and is active on social networks. However, purchasing decisions on networks are not as developed as in Europe or the United States. The Algerian diet is based on a Mediterranean model. Algerians are big consumers of cereals (durum wheat, semolina, bread, couscous, etc.), pulses (lentils, beans and chickpeas), fruit and vegetables, olive oil, with little meat, as well as products derived from milk, eggs, fish. Algerians have traditionally eaten lamb and poultry. In the south, camel meat is also consumed.

While Algeria’s society remains dominated by traditional family institution, socioeconomic changes are driving noticeable shifts in consumers’ consumption preferences and the food retail landscape. The population has quadrupled in 60 years, reaching over 45 million inhabitants in 2023. As of 2022, Algeria’s urban population was estimated to be over 70 percent of the total population. Overall, the participation of Algerian women in the workforce is gradually increasing, driven by improvements in education, changes in societal attitudes, and supportive government policies. In the urban centers, the younger generation is increasingly following global trends seeking out fast food, chawarma, and snacks as well as sweetened drinks. In April 2024, a Lebanese group AZADEA opened the first KFC restaurant in the capital. Pizza Hut, Subway, Coca Cola, PepsiCo, Nestle, and Heineken are all present in Algeria.

Advantages and Challenges

Potential exists for U.S. exporters to obtain a share of the Algerian market and participate in its further development.

Section II: Exporter Business Tips

General Consumer Tastes and Trends: Algeria has one of North Africa’s highest per-capita expenditures on food thanks to relatively high disposable incomes and consumers’ strong preference for convenient, quality, and premium food and beverages. Algerian households devote more than 40 percent of their annual expenditure to food needs. Consumer tastes and preferences are changing, especially in the cities where young homemakers tend to be more active, and the number of working women has increased. As a result, consumers are turning to ready-to-eat or semi-processed products. Although some people are attracted by the organic and healthy diets, dietary habits are changing to a diet richer in animal fat and sugar.

Market Research: For the most part U.S. exporters are not familiar with the Algerian market and its regulations, and the same is true for Algerian importers seeking U.S. products. U.S. exporters should inquire about all the regulations and the Algerian market structure before starting business or shipping goods. They can identify a potential importer, distributor or a consultant who is aware of the business culture and the market structure, who knows the food and retail sectors’ players and can execute all the necessary steps and resolve any issues on the ground on behalf of the U.S. company.

Market Structure: The structure of the market is detailed in section IV below. Overall, the food retail and distribution sector are developing. Supermarket industry is growing, albeit slowly. Local food manufacturing industry is fundamentally dependent on imports of ingredients and raw materials. Most of these sectors are exclusively controlled by private businesses. Most of the supermarkets, hotels and food retail stores do not import directly, but purchase from local wholesalers and importers. Large food processors import their own ingredients. Most importers are in large cities and import through the ports of Algiers, Oran, Bejaia, Mostaganem and Jijel. They import both bulk and packaged products. The products are distributed to wholesalers and then sold in small stores, supermarkets, and wet markets. Algeria uses the metric system. French and Arabic are the predominant business language.

Section III: Import Food Standards, Regulations and Procedures

Import food standards and regulations as well as import procedures can be found in the FAS Food and Agricultural Import Regulation and Standards Reports.

Fairs Annual Country Report

Fairs Export Certificate Report

Section IV: Market Sector Structure and Trends

Food Retail and Distribution: Private businesses control retail trade almost exclusively. Since the economy was liberalized in the 90s, consumers became accustomed to seeing imported products and semi-processed products sold in grocery stores and small private supermarkets. Consumers shop for bulk, packaged and high value products, both local and imported, in small supermarkets called “superettes”. Private wholesalers are increasingly active in the food sector. The private sector is also trying to expand distribution channels, as well as the hotel restaurant institutional (HRI) sector.

Overall, the supermarket industry is still in its infancy. The Ministry of Commerce has also invested in the construction of smaller, urban retail spaces that meet industry standards to strengthen the regulation of the retail network to ensure price stability, especially for food staples. According to the 2016 data available by the Algerian Register of Commerce, there were 1,415 retail markets in the country, 38 Hypermarkets, 1,919 superettes and 232 supermarkets. Only three large private supermarket chains (UNO, ARDIS, FAMILY SHOP) exist in the capital and four other main cities of the country. The French chain Carrefour is also present in Algeria.

The Algerian food sector could also develop much more quickly if modern distribution was itself sufficiently developed. While large and medium-sized firms are modernizing, many small firms do not master processes, traceability, filling and packing, international standards or banking and tax procedures. Food industry firms must sometimes manage their own distribution networks themselves and provide assistance to their wholesalers to enable them to acquire their equipment.

Food Processing: The government has committed to divesting itself from agricultural production and processing. Private processors continue to grow, and many are offering products at lower prices by importing raw materials and processing them locally. The private sector is active in wheat and feed milling, dairy processing, vegetable oil refining, sugar refining, beverage production, canning, and the biscuit industry as well as soybean crushing plants.

The local food manufacturing industry is fundamentally dependent on imports of ingredients and raw materials. In addition, population increase, growing demand for convenient processed foods, as well as improved production capacities favor the expansion of the food processing industry. These conditions support demand for ingredients and create opportunities for increased U.S. exports into Algeria.

Milling and Dairy industries: Wheat is the major staple food followed by dairy. Several mills and dairy plants are operating in different regions of the country with varying capacities. These enterprises are increasingly interested in U.S. products and expertise.

HRI sector: This sector is growing however still needs further expansion. The opening of five-star international hotel chains as well as local four-star and three-star hotel chains increases demand for inputs and ingredients. Domestic fast food and new restaurants chains are growing as well.

Beverage, Canning, Snack and Biscuit industries: The local food processing industry is improving and upgrading. They are aware of the need for consistent quality and regular supply of higher quality inputs. This sector represents a good prospect for U.S, suppliers of ingredients. This is an opportunity for U.S. expertise and food ingredients exports. The food industry and ingredient show “Djazagro ” newsletter indicated that the food market revenues in Algeria amounted EUR 10.8 billion in 2022. The largest market segment is confectionery and snacks, with a market volume of EUR 2.4 billion in 2022.

In the food market, 1.8 percent of total revenue will be generated by online sales by 2022. In the Food market, 0.9 percent of total revenue will be generated through online sales by 2024.The Food market volume is expected to amount 5.75bn kg by 2028 and the volume growth is expected to reach 2.0 percent in 2025. The average volume per person in the food market is expected to amount to 114.70kg in 2024.

The newsletter reported that the revenue of the soft drinks market amounted EUR 1.9 billion in 2022. The largest market segment is carbonated soft drinks with a market volume of EUR 1.4 billion in 2022. The revenue of the hot beverages market amounted EUR 2.6 billion in 2022. The market is expected to grow at a compound annual growth rate (CAGR) of 0.61% per annum (2022-2025). The largest market segment is coffee, with a market volume of EUR 2.2 billion.

More information on the food, retail, distribution and beverage market trends can be found at this year’s edition of Djazagro Show newsletter.

Section V: Agricultural and Food Imports

Agricultural and Food Import Statistics

Unfortunately, the Algerian Customs website has not published any trade figures since 2020. The sole import figures available are from 2020. Algerian imports of agricultural commodities and food represented about 23.52 percent ($8.09 billion) of total imports ($34.39 billion) in 2020. Wheat and dairy are the top food imports. Algeria is one of the world’s largest importers of wheat and dairy products. The other products were represented by (sugar and confectionary, coffee and spices, food preparations, food industry residues, edible fruits, legumes, roots and bulbs, live animals and tobacco and processed tobacco.

Data from the Trade Data Monitor (TDM) shows that Algeria’s total imports of consumer-oriented the last five years has remained fairly stagnant. However, staple food (wheat and dairy products) remains dominant compared to consumer-oriented products.

Trade Data Monitor (TDM) chart below shows the top exporting countries of consumer oriented agricultural products to Algeria. EU countries remain the main supplier of finished food products to Algeria. The U.S. is at a geographical disadvantage, due to Algeria’s proximity to Europe. Additionally, there are no direct shipping lines from the U.S., making transit through Europe necessary. Moreover, the EU-Algerian Association Agreement provides preferential access to some commodities making relatively high cost for U.S. food and agricultural products compared to imports from other countries.

Best High-Value, Consumer-Oriented Product Prospects

Most of the U.S. agricultural exports to Algeria are bulk and intermediate commodities. Consumer oriented products represent only 15 percent of the total U.S. exports to Algeria in 2023. In calendar year (CY) 2023, the main U.S. agricultural exports to Algeria were wheat, soybeans, tree nuts, soybean meal, planting seeds, feed & fodders, forest products, dairy products, pulses, as well as live animals (turkey day-old chicks and hatching eggs).

As shown in the chart below, the best prospects for U.S. consumer-oriented products are tree nuts at the top of the list showing an upward trend.

Tree nuts: Demand for tree nuts remains high, especially since additional import tariffs (DAPs) on tree nuts and dried fruits was removed since 2019. Imports are not hampered even by price increase as shown in the chart below. The figures below indicate that despite the increase of prices over the years, volumes increased.

The United States remains the leading exporter of tree nuts to Algeria. (See U.S. Exports chart below). For more information, please review the FAS Tree Nuts Report.

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