Rice, Pasta and Noodles in Venezuela

PROSPECTS

Dried pasta imports gain importance in a country depleted of wheat

Due to its tropical climate, Venezuela’s supply of wheat depends solely on imports, which are under the strict control of the government through the issuing of import permits, subsidised foreign currency and the allocation of quotas to flour mills. In 2018, wheat imports continued to be insufficient to satisfy the domestic demand for pasta.

Unsatisfied demand for rice due to insufficient imports and poor domestic crops

Rice showed massive shortages during the period 2013-2016, due to large declines in domestic crops and a lack of imports by the government. In 2016, a decline of 60% in domestic rice crops was partially covered with imports brought in by the government, which do not reach regular distribution channels but are allocated directly to previously screened people.

Discretionary allocation of wheat causes shortages of pasta and noodles

According to FEVIPAN (Federación Venezolana de Industriales de la Panificación y Afines – the Venezuelan Federation of Industrial Baking), 32% of the wheat flour manufactured goes to the production of pasta. Wheat mills such as MONACA and Cargill must wait for the quota of wheat grain allocated by the government; the wheat flour is then passed to the pasta companies, which are also responsible for the production of noodles for the industry.

COMPETITIVE LANDSCAPE

Alimentos Polar gains strength in 2018

Alimentos Polar strengthened its lead in rice, pasta and noodles in value terms in 2018. The well-established position of this company is attributed to the leadership of its Primor brand, which is the leading brand in both dried pasta and rice.

Affordability reigns over brand loyalty in 2018

The adoption of a policy of price control on staples has led rice and pasta to lose segmentation, with all brands behaving as commodities. Consumers have lost brand loyalty and buy the brand that is available at the time of purchase after assessing its affordability.

Pasta is expected to remain more popular due to its lower price

Unlike rice, which is consumed as a side dish, pasta is mostly consumed as a main dish. Due to its relatively lower price, Venezuelan households will continue to favour pasta over meat.

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