Exploring export opportunities for niche horticulture produce
The recent state visit by the President of Belarus brings evidence of on the positive trajectory that President E.D Munangagwa’s Second Republic is taking in its economic diplomacy agenda, where the focus is on creating value from stellar relations that Zimbabwe enjoys.
With the Government forging stronger relations with countries from across the world, local companies stand to benefit most, as business relations are strengthened, and new markets are created.
However, to obtain the maximum value from these relations, local companies need to leverage on areas where the country enjoys comparative and competitive advantage.
Horticulture is one of those areas and locally-grown produce are already known for their high quality and better taste across international markets.
Natural products, spices and herbs coming from Zimbabwe are also known to have better quality.
This is not an assumption, but a fact that has been confirmed over many years by potential buyers.
For example, local companies who exhibited at the Fruit Logistica fair that ended on Friday in Germany were told that Zimbabwean produce have potential to perform well in any market across Europe.
Fruit Logistica is the world’s leading international trade fair for the fruit and vegetable industry.
Facilitated by ZimTrade – national trade development and promotion organisation – the local companies that participated at the fair engaged with buyers, distributors, packagers, handling experts and other interested parties from across the world.
With the quality and export potential of Zimbabwean produce confirmed by potential buyers, the focus for companies that are working on their export strategic plans should be on continuously introducing new profitable markets and products to their portfolios.
As they ponder on which markets to diversify to, the companies must narrow down their market focus to be able to find areas that haven’t been tapped into by their competitors.
Diversification helps companies in broadening their revenue streams and in the process increase their profitability.
Companies can diversify their products by focusing on niche products because niche products help them establish a loyal customer base as the offering suits the needs of a specific customer segment within the broader market.
Niche products are more profitable because a company can price them higher than generic products since the market is insensitive to a price change.
The market focuses more on the value they get from the product offering as opposed to pricing.
Some of the benefits the companies can reap from focusing on niche products include less competition, lower marketing spend, higher profit margins and increased brand loyalty.
In Zimbabwe, niche produce such as super foods, natural and wild fruits, essential oils, herbs, and spices are creating opportunities for companies to make money in the international world by harnessing this untapped market.
The super foods’ demand emanates from their high nutrients and perceived ability to ward off diseases and keep you healthier.
The market believes that superfoods can help protect them against diseases, improve their mood, and boost their energy levels.
Some of the superfoods found in Zimbabwe with huge export potential include baobab fruit, sweet potatoes, whole grains like brown rice and oatmeal, and pecan nuts amongst others.
Most of the locally produced superfoods are found in abundance and have higher nutritional value compared to what is already in international markets.
For example, baobab fruit is found in semi-dry areas across Zimbabwe and the product is rich in vitamins and minerals such as potassium, magnesium, iron and zinc.
Baobab fruit’s demand is growing largely being driven by the health-conscious market who continuously look for high nutritious value products.
The product can be marketed as powder, oil, harvested pulp and supplements.
The baobab oil, extracted from the seeds, is commonly used in hair and skin products. The powder is used predominantly in smoothies and porridge.
It has the highest antioxidant ratings. Baobab fruit has seen its use expanded into gin, beauty products and yoghurt.
It has been widely accepted in most European restaurants who at times make baobab butter for baobab popcorn or use it to marinate and panfry tilapia and prawns.
Apart from the Baobab product, Zimbabweans can also target the spices market segment as there are huge export opportunities in this segment as well.
Spices such as turmeric, ginger, garlic, peppermint, cinnamon, parsley and chili powder not only improve the taste of food but also a good source of vitamins B and C, iron, calcium, and other antioxidants.
Spices are being used by many medical industries like cosmetic, pharmaceutical, and aromatic as perfumery. In the food industry, spices are used to enhance the taste and flavour of the food.
According to the Trade Map, spices consumption rose from US$2.5 billion in 2017 to US$3.6 billion in 2021 with the main markets being United States of America, Malaysia, Netherlands, Germany, Saudi Arabia, France, and United Kingdom.
Black pepper is the most traded spices in the world and the most popular spices in the world include black pepper, paprika, chili powder, cumin, ginger, garlic, and cinnamon.
However, it is important to note that different spices are popular in different regions and cultures.
For instance, turmeric, cumin, coriander and chili are more popular in India and South Asia; cinnamon is more popular in Western countries,
Oregon is common in Mediterranean region whilst garlic is most common in Europe and Africa.
Essential oils which include baobab oils, marula oils, mongongo oils amongst others has seen its consumption increase from US$5.4 billion in 2017 to US$5.8 billion in 2021 according to Trade Map.
The major export destination includes United States of America, France, Germany, China, Ireland, and United Kingdom.
According to Global Market Insights, the market for baobab products is expected to grow by 5.6 percent.
Accessing export markets
As companies choose the markets to serve, it is encouraged to consider those countries that Zimbabwe has cordial trading relations with for easy acceptance.
Zimbabwe has bi-lateral and multilateral trading agreement with different countries as a way of promoting trade between Zimbabwe and those countries.
Zimbabwe has bi-lateral trading agreements with Malawi, Mozambique, Botswana, and Namibia.
The multi-lateral trading agreements Zimbabwe is a member include SADC, COMESA and UK-EPA-ESA.
Europe has traditionally been the first and largest market for baobab export, and companies can trade under the Euro1.
Trading the UK-EPA-ESA trading agreement allows Zimbabwean products to enter into the United Kingdom market duty free and quota free.
To benefit from these trading agreements, companies must register for them with ZIMRA and the process is free of charge.