Yoghurt and Sour Milk Products in Nigeria

2021 DEVELOPMENTS

Continued movement restrictions hamper volume growth

In 2020, the COVID-19 pandemic led to significantly slower growth in yoghurt and sour milk products as the global economy worsened and unemployment increased. Furthermore, as the country’s currency depreciated (due to the international oil price crash) retail unit prices of yoghurt and sour milk products heightened whilst consumers’ disposable incomes decreased.

High prices and decreased disposable income continue to keep spending low

Rising prices and reduced availability of raw materials also occurred in yoghurt and sour milk product as the spread of COVID-19 disrupted imports. This has led to higher unit prices in the category in 2020.

Ranona retains lead as competition in yoghurt intensifies

The level of competition in yoghurt has intensified in recent years thanks to the emergence of new players looking to tap into yoghurt’s growth potential. There is a marginal share difference between top players Ranona and CHI, with the former overtaking the latter in 2020.

PROSPECTS AND OPPORTUNITIES

Yoghurt to benefit from perception as a convenient, filling, and nutritious snack for both adults and children

Yoghurt is expected to perform well over the forecast period as it further recovers from the negative impact of a slow economy over 2015-2017 and the pandemic turmoil in 2020 and 2021. The category will benefit from the country’s growing population, especially its urban one, and its perception as a convenient, nutritious, and filling snack.

Strong prospects for both drinking yoghurt and spoonable yoghurt

Drinking yoghurt has a long tradition in Nigeria, albeit in unpackaged form. Thus, manufacturers are expected to take advantage of its popularity by offering better quality products than traditional cottage variants, such as the local kunnu, in line with increasing urbanisation and a desire for novel tastes.

Further premiumisation expected as economy improves

Over the forecast period, yoghurt is predicted to see a greater manufacturer focus on premiumisation, especially when the economic climate in the country improves. Such products tend to be consumed by middle- and upper-income households, who enjoy purchasing products of significantly higher quality than the more popular mass brands.