Egypt’s food processing is a very dynamic sector, averaging a compound annual growth rate of
12 percent in the last 5 years. The food processing industry in Egypt is very fragmented, providing ample opportunities to tap into the market at all levels. Barriers to entry are low, as Egypt only requires product registration for special dietary food products. However, many U.S. food ingredients face high tariffs vis-a-vis ingredients from Europe, Africa and the Middle East, which enjoy a favorable tariff regimen due to trade agreements. The top U.S. food ingredient export to Egypt is processed dairy products at $106 million in 2014 or 82 percent of total exports of U.S. food ingredients, and will remain the leading food ingredient export from the US in the near future. Other best prospects include U.S. processed eggs, retaining a 20 percent market share
and an annual growth rate in sales of 5 percent. U.S. processed vegetables and pulses have established a niche market in Egypt’s food processing sector. Food preparations face comparatively lower tariff rates at 5 percent, against the non-tariff rate for African, European, and Middle Eastern competitors
Food Processing Sector
Egypt’s food processing is a very dynamic sector, accounting for five percent of the country’s GDP valued at LE 108 billion ($13.5 billion) in 2014 The sector averaged an annual growth rate of 12 percent in the last 5 years and consists of 77,285 establishments, employing hundreds of thousands of Egyptians.
The food processing sub-sectors have all increased sales at a brisk pace, with the nutrition/staple sector dominating all other sectors. In 2014, this sector attained sales of close to EGP 57 billion
($7.3 billion), followed by the impulse and indulgence product sector at EGP 24 billion ($3.07 billion), and dried processed food at EGP 11.9 billion ($1.62 billion).
The food processing sector imported $1.89 billion in food ingredients in 2014, excluding meat and bulk commodities, an increase of 15 percent over 2013. In the last 5 years, imports have grown by an annual rate of 15 percent
In 2014, Egypt’s top food ingredient import was processed dairy products valued at $802 million, which includes powdered milk, butter, whey, and cheese. The second largest import category was food preparations at $293 million, and this includes malt extract, protein concentrates, yeasts, pectates, and starch. The third highest value import was prepared or preserved seafood at $278 million