Locally produced food
records sharp surge in sales

Producers and distributors are expanding their operations

Food producers are witnessing a surge in sales compared with pre-crisis levels thanks to a radical shift in demand towards local food products driven by the sharp rise in the prices of imported goods.

Anthony Massoud CEO of Ets Antoine Massoud (EAM), a distributor of food products, said that their turnover of local alcoholic drinks has jumped 75 percent. Their sales of honey doubled while sales of sweet snacks soared 150 percent.

Ayadina, which produces traditional pickles and jams, saw its output climb 50 percent. “Supermarkets now feel that they have to buy locally in order to fill gaps in their imported product lines. We used to have a very tough competition from French brands of cornichon pickles. But we can now sell our cornichons more easily,” said Roy Harb founder of Ayadina.

This booming business is encouraging food distributors to increase the portion of local products in their portfolio. The share of local products in EAM’s otal turnover has increased from five percent to 20 percent. “A distributor’s exposure to currency depreciation is 100 percent in the case of foreign brands while it is much less for local brands,” Massoud said.

Food producers are also expanding their operations. Harb said they plan to add a kitchen and storage space, and hire more female workers for their handmade products. Ayadina, which has started exports, will be using the fresh dollars generated from its sales abroad for the expansion while local revenues will be used to operate the business and pay the salaries of its employees, he said.

Nicolas Gholam, co-founder of Mawsam, a startup that distributes food products made by small producers, said the higher the local component of raw materials of a product, such as thyme, the more competitive it becomes vis-a-vis foreign products. “This is not the case of wine, for instance. The price of the bottle, which is imported, often represents around 30 percent of the total price,” he said.

The Ministry of Agriculture said in its ‘Lebanon National Agriculture Strategy (NAS) 2020 – 2025’: “The aftermaths of the financial crisis will reduce the Lebanese household purchasing power towards imported agrifood goods opening a window for opportunity for more import-substitution domestic production. It is an opportunity in terms of reduced consumption of foreign exchange, increased value addition of the economy, and increased employment especially for the more marginal population groups.”