In an effort to control the spread of COVID-19 Saudi Arabia introduced a strict lockdown in March, with restrictions not fully lifted until the end of June. This took a heavy toll on foodservice sales of beverages, but conversely it provided a huge boost to sales of BFY beverages.
BFY reduced caffeine beverages saw impressive growth in current value terms in 2020. The worldwide health and wellness trend is having a growing influence over consumers in Saudi Arabia, and they are becoming increasingly mindful of the choices they make including when it comes to choosing beverages.
With almost three-quarters of the Saudi population being overweight or obese there are growing efforts being made by both consumers and the government to reduce sugar intake. Part of these efforts included the introduction of a 50% excise tax on sugary beverages which came into effect on 1 December 2019.
In light of the new sugar tax and the country’s growing obesity crisis, it is anticipated that there will be significant investment seen in developing new and healthier drinks options, which should benefit BFY beverages. COVID-19 served to highlight that being overweight or obese can carry an immediate health threat, with these consumers falling into the at-risk category from the virus.
Over the forecast period, it is expected that consumer awareness concerning the dangers of high caffeine and sugary soft drinks will continue to rise resulting in consumers replacing carbonates, concentrates and energy drinks with BFY beverages. This is expected to be in the form of more natural reconstituted reduced sugar juice drinks (up to 24% juice) and reduced sugar nectars (25-99% juice).
One of the key drivers of growth in BFY beverages is expected to be Saudi Arabia’s younger population. These consumers are not only often more health aware than the older generations, but they are also becoming increasingly influenced by Western culture through social media and international travel.
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