Last year in Nigeria, the sales of noodles increased by more than a third, according to new data. This happened because the price of rice went up, making more people choose cheaper alternatives.
A report from Euromonitor International, a global research provider, reveals that the sales value of noodles in the formal market of the country rose by 38.2 percent to N427.2 billion in 2023.
This is the highest it has been in at least six years. Pasta sales also increased by 26.1 percent to N404.0 billion, while rice sales rose by 14.4 percent to N494.0 billion.
The sales volume for noodles increased to 266,600 tonnes from 263,700 tonnes. However, pasta sales volume dropped to 384,700 tonnes from 396,600 tonnes, and rice sales decreased from 547,400 tonnes in 2022 to 520,400 tonnes in 2023.
Noodles was the only category within rice, pasta, and noodles to see growth in 2023, albeit marginal.
The report mentions that the quick preparation time (three to five minutes) and small pack sizes make noodles an affordable option during challenging times.
The report highlights that noodles have become more popular in food service due to their convenience and low prices.
In April, the leading noodles player, Dufil Prima Foods Plc, opened its eighth foodservice outlet, Indomie Café, with plans for more in the future.
Pasta is also considered a cheap and convenient meal, but high unit price increases in 2023 dampened demand due to the rising price of wheat caused by the war in Ukraine.
Rice faced the most substantial retail volume decline within the category in 2023. Packaged rice faces competition from unpackaged rice, as food specialists tend to buy large bags of rice and sell them in smaller, more affordable quantities to local consumers.
The data breakdown shows that plain noodles recorded the same sales of N0.9 billion in 2023 and 2022. However, instant noodles rose from N308.3 billion to N426.3 billion.
People interviewed for the report mentioned the affordability of noodles compared to rice. In the face of rising inflation and economic challenges, consumers like Oyinda Aminu and Olatide Praise find noodles to be a more budget-friendly option.
The inflation rate in Nigeria has accelerated to the highest in at least 20 years over the past seven months.
The removal of the petrol subsidy and naira devaluation contributed to this economic situation. The headline inflation rose to 28.92 percent in December, with food inflation constituting 50 percent of the inflation rate.
A survey of major markets in Lagos shows that staple food prices have increased. The average unit price for rice, pasta, and noodles increased by 30 percent in 2023.
The authors of the Euromonitor report mention that, despite being considered essential, local consumers are gravitating towards unbranded/unpackaged staple foods.
A recent report by SBM Intelligence indicates that despite cost-cutting and inflation management measures, Nigerian households are spending 97 percent of their earnings solely on food.
The rising inflation and sluggish growth have increased the number of poor people in the country to 104 million in 2023.
The World Bank’s latest Nigeria Development Update report emphasizes the need for a holistic approach to reduce inflation, including tighter fiscal and monetary policies.
It also notes that targeted cash transfers have been initiated to mitigate the impact on vulnerable households.
According to BusinessDay decline in staple foods for the second straight year, and an outlook report by the Food and Agricultural Organization and World Food Program projects increased prices of staple foods in 2024 for Nigeria and other West African countries.
This is attributed to factors like production deficits, trade restrictions, insecurity, elevated global prices, and currency depreciation.
