Regional context
Sub-Saharan Africa, a region comprising forty-eight countries south of the Sahara Desert, is the world’s second fastest growing economic region, topped only by emerging Asia. Economic growth in Sub-Saharan Africa is on the rise, from 4.7 percent in 2013 to a forecasted 5.2 percent in 2015. This performance is boosted by rising investment in natural resources and infrastructure; and strong household spending according to the World Bank. This is despite a few countries having experienced the adverse economic impact of the sharp decline in oil and other commodity prices as well as the recent Ebola epidemic.
The population of Sub-Saharan Africa was some 900 million inhabitants in 2014 and with the current growth rate, the United Nations predicts a population of nearly 2.1 billion by year 2050 for this region. The population growth is a major encouragement for market expansion for food, including seafood and other related commodities. The region is also witnessing a rise in incomes per capita, and rapid urbanisation interlinked to the growing modern distribution channels.
African governments are increasingly adopting policies to energise markets including focusing on expanding intra- African trade. Despite the positive prospects, fish demand in Sub-Saharan Africa outstrips supply. The average fish consumption rate in the region is estimated at 8.9 kg per capita compared to a world average of 18.9 kg, according to FAO. This is largely due to limited supplies. Consequently, the region has witnessed a sharp increase in seafood imports from other parts of the world in recent years.
Tilapia, which is native to Africa, has become the second most popular farmed fish globally and one of the most traded seafood commodities. The fish is consumed as an affordable source of protein in poor rural communities as well as in affluent urban centres. In Sub-Saharan Africa, tilapia, in its various strains, is largely caught from traditional wild sources such as rivers, lakes, dams etc. 
Tilapia production in the region
Tilapia is one of the most exploited inland water fish species in tropical to sub-tropical ecosystems of Sub-Saharan
Africa, supporting livelihoods of many, and providing vital food security. The fish is still largely available from traditional freshwater capture resources such as rivers, dams, lakes etc., much more than it is farmed. Over 350 000 tonnes of tilapia (all its strains) were captured annually during the peak production period of 2007 - 2009. However, fishermen from most producing countries are reporting a decline in catches, compared to decades ago, largely due to overfishing fuelled by increase in populations and greater demand. In some cases, decline in catches is attributed to climate change dynamics. In 2012, according to the FAO, catches fell below 300 000 tonnes.
The situation has become dire in countries such as Malawi where the decline in the catches of their local tilapia strain, the Chambo (Oreochromis spp), has affected the livelihoods of thousands of people. To control the fishing pressure, some countries have introduced seasonal fishing bans to allow the fish to replenish. Not only is the implementation of this fish ban policy difficult to carry out (particularly on shared water bodies), but such a move has in a way created seasonal supply shortages to domestic markets.
The supply gap, population rise, and increased knowledge of the “goodness” of tilapia products have caused huge demand for farmed tilapia in Africa.
Governments in the region, in recognition of the importance of the aquaculture sector in national economies, have begun prioritising its development through several measures, including investments in farming.
In fact, aquaculture production of tilapia has grown tremendously, at an annual average rate of 20 percent over the last decade, and is presently the top fastest growing aquaculture sub-sector. In 2012, about 150 000 tonnes of tilapia were produced through aquaculture in the region, according to FAO.
It must be noted that by far, Egypt is the biggest aquaculture producer of tilapia in the whole continent, producing over 800 000 metric tonnes in that year. However, Egypt has been excluded from this analysis as it falls outside Sub-Saharan Africa.
Countries such as Ghana, Kenya, Nigeria, Uganda, Zambia and Zimbabwe have recorded remarkable growth in commercial aquaculture production of tilapia in recent years. Several other countries of the region have just begun implementing small, medium to large scale ventures which are yet to produce meaningful results.
Farming of tilapia is practised by smallholder producers either in home backyards for subsistence purposes, to small scale commercial ventures, using various production systems. Large, vertically integrated and industrial scale ventures are found mainly in Ghana, Zambia and Zimbabwe. Nile tilapia (O. niloticus) is the preferred species for aquaculture production.
Market potential for seafood in sub-Saharan Africa
Tilapia is a traditional and favourite dish in almost all countries of Sub-Saharan Africa. Some even call it a “democratic fish” in the sense that the fish is consumed as an affordable source of protein in poor rural communities, to being a premium product for the affluent in urban centres. The average annual per capita fish consumption in Sub- Saharan Africa is approximately 8.9 kg. It is difficult to quantify demand trends specifically for tilapia due to scanty data; however nearly all tilapia produced in Sub-Saharan Africa is locally consumed, with very limited exports to overseas markets. Notable countries with a strong demand for tilapia include DRC, Ghana, Malawi, Nigeria, Uganda and Zambia.
Another factor fuelling demand for tilapia and other freshwater fish products is the rapid urbanisation and a steep growth in immigrant populations, most of whom come from strong fish consuming nations. For instance some oil and mineral producing countries have in recent years witnessed a huge influx of immigrant populations, mostly from Asia, who have come to work on national infrastructure development, retailing and mining. This has become an important and emerging market segment for freshwater fish.
The markets for tilapia in Sub-Saharan Africa are diverse – ranging from small scale localised markets e.g. at farm gates and roadside market stalls to more sophisticated commercial distribution chains and depots linked to large retail chains selling a range of product forms including value-added products.
Small-scale and sometimes informal traders have become important in the tilapia distribution chain. This has been seen at the two biggest producers in Sub-Saharan Africa: Lake Harvest Aquaculture in Zimbabwe and Tropo Fish Farms in Ghana where such small scale fish traders (usually women), would buy fresh fish from formal fish distribution depots in smaller units and distribute the fish through door to door selling or roadside stalls in their urban localities. This has become an important economic and livelihood activity particularly for women traders.
In addition, large retail supermarkets are increasingly becoming important destinations in the supply chain in urban areas for the marketing of quality products. Such retailers demand consistent supplies of both fresh and frozen product. However, the bulk of tilapia is sold fresh (whole round or gutted) at farm gates, and landing sites.
Frozen product, including that imported from China, has also found a good market in urban markets.
The marketing of other product forms is dependent on several factors such as market segment, price competiveness, storage/preservation etc. For instance dried, salted or smoked tilapia products (from wild caught tilapia) are common in rural markets where electricity for freezing the product is in short supply. Similarly the marketing of value-added products such as fresh/frozen fillets is targeted mainly to urban niche markets where hotels, restaurants and some supermarkets demand the product to satisfy some of their market segments.
Tilapia fillets, particularly fresh product, have in the past been for export, mainly to the EU, by certified exporters. Meanwhile, China has begun exporting frozen fillets to Africa, having seen growing demand for the product in urban areas. Prices of tilapia (in its various product forms) vary across the region, with countries such as Angola, DRC, Equatorial Guinea, Ghana, Nigeria, and Zambia having recorded attractively higher prices for domestic producers and importers.
For instance, retail prices for a kg of frozen whole- gutted tilapia can range from US$2.50 (Zambia) at the lower end, to as high at US$13 in special case markets such as in Angola.
Opportunities and challenges for tilapia marketing in Sub-Saharan Africa
Africans love tilapia. The African market is increasingly demanding a consistent supply of products all year round but with the dwindling nature of traditional sources of fish, an opportunity remains for aquaculture producers to meet future supplies of tilapia. It is also a good business opportunity for fish importers and exporters.
China, which is the largest producer of tilapia in the world, is increasingly exporting frozen tilapia products to Africa. This has understandably been a huge competition challenge for African tilapia producers, some of whom are countering such competition through several strategies including the consistent marketing of higher quality locally grown and fresh product. Tilapia product prices are increasingly becoming favourable for traders in many countries compared to other world markets.
However, the high cost of tilapia production, processing and distribution remains a major challenge in Africa compared to Asia and South America. As most transactions are done in US$ terms, African seafood importers are also being affected by the dynamics of the appreciating US$, which has a significant impact on trade. The most immediate disadvantage of a weaker local currency to the dollar is the increased cost for foreign goods and this includes tilapia imported from China.
Meanwhile, the economic situation in some African markets remains volatile and conditions for doing business remain difficult and need proper assessment. Countries with ongoing wars and the recent Ebola endemic in West Africa are examples. Trade of seafood products is sometimes hampered by inadequate infrastructure (transport, storage, communication and distribution facilities) required to market large volumes of fish. Some key markets such as DRC and Angola still have some logistical problems in managing the smooth flow of imported seafood; consequently, fish end up only in major urban centres leaving the rest of the countries undersupplied.
Outlook and conclusion
Tilapia supplies from both capture and culture are not yet able to meet domestic demand in Sub-Saharan Africa. However, all indications point to a growth in aquaculture production of tilapia in many countries in the region, driven by strong demand and to meet the deficit.
Many aquaculture ventures established in recent years are expected to begin producing meaningful volumes in years to come. We will continue to see tilapia re-affirming itself as a contributor to national food security in many countries as the region’s population continues to rise. Although generally declining, capture fisheries of tilapia will remain important for the foreseeable future. There might be some slight improvements following recently applied fishery management measures.
Tilapia imports from other world producing regions, particularly Asia, will continue to increase, with the preferred products in frozen whole gutted form, and also fillets, destined for more liberal (in terms of trade) markets such as Angola, DRC and others where prices are favourable to importers.
However importers will increasingly face strong import tariffs and other non-tariff barriers as several domestic producing countries try to protect their local aquaculture industries. Recent fish import bans and the introduction of import quotas and tariffs in Ghana and Nigeria are examples.
Sub-Saharan Africa presents a solid opportunity for tilapia producers, processers and traders but tailored strategies are required to do business successfully. It is important to understand African customers’ changing preferences, lifestyles, and daily needs. One then needs to apply some marketing intelligence to formulate a winning business model in the marketing of locally relevant, quality tilapia products.
Despite some areas in Africa still being problematic on many fronts, the future outlook for tilapia marketing seems encouraging. There is no doubt that the continent has become one of the world’s most dynamic macro-economic growth regions, with the fastest growing population, expanding middle-class and increased household incomes. If Sub-Saharan Africa can maintain its present positive direction, there is no reason why it cannot be the great tilapia market growth story within the next century.
Source: INFOFISH International
November 2015
