The silver lining in Lebanon's deteriorating economy? Canned goods demand boosted by Syrian refugees

The silver lining in Lebanon's deteriorating economy? Canned goods demand boosted by Syrian refugees
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Published September 12th, 2013 - 12:55 GMT via SyndiGate.info

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"According to sources familiar with this market, sales have increased to the point that “there is a container or two each day, loaded with various kinds of foodstuffs, going from Tripoli to Syria.” These factories are flourishing in a manner they never dreamed of (Photo credit:Getty).
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Tripoli
,
Mount
,
Mohammad Wehbe
,
United Nations

It is not a secret that Syrian refugees in Lebanon have stimulated consumer demand for basic goods and foodstuffs. As such, food-processing businesses in Lebanon have stepped up production dramatically to meet this demand.

This is nearly the only sector that has improved because of the Syrian crisis. According to estimates put together by Lebanon’s food-processing factories, additional consumer demand for canned foods covers around two million consumers. Based on this estimate, those working in this sector believe that the number of Syrian refugees in Lebanon could be in the vicinity of one million.

Meanwhile, commercial sources said that demand for ready-made foods, that is, canned goods, juices, jams, and pickles, has increased by one and a half during the current year. The increase in demand has come mainly from residents in Lebanon, especially Syrian refugees, in addition to orders by UN organizations and NGOs meant as aid for Syria.

Practically, this has translated into increased sales in the local market, rising from 23 percent to 45 percent of total domestic production. Sales of food products might actually exceed last year’s $280 million.

Products in this sector include various types of canned foods, such as fava beans, chickpeas, hummus, products derived from sesame seeds – such as tahini and halva – juices, carbonated drinks, spices, and nuts. All these goods are manufactured or packaged by dozens of factories in Mount Lebanon, the Bekaa, and the north.

Before the Syrian crisis, the domestic market share of these goods was about 23 percent. Today, this figure has risen to 45 percent, and the rest is exported overseas. According to sources familiar with this market, sales have increased to the point that “there is a container or two each day, loaded with various kinds of foodstuffs, going from Tripoli to Syria.” These factories are flourishing in a manner they never dreamed of.

The factories even refused to observe the strike called by the Economic Committees last Wednesday, September 4, as they had committed to delivering large orders and could not suspend their operations. Meanwhile, it does not seem that there is fierce competition among food industrialists, as demand is abundant and they are all operating at full capacity, without coming close to meeting all of the demand.

Sources in the Syndicate of Lebanese Food Industrialists (SLFI) believe that the Syrian crisis created an opportunity to increase local productive capacity and expand penetration in Arab markets. However, they said, “Lebanon has not been able to attract Syrians producers. For example, the corn plant in Syria, one of the largest food processing plants there, tried to transfer its operations to Lebanon, in the Bekaa region. But it found out that production costs were too high, meaning that keeping up with international prices would not be possible. The plant ultimately moved to Jordan, and is now exporting its products, still labeling them as Syrian goods. It can still compete in foreign markets as well.”

By: Mohammad Wehbe

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