Food and beverage to Fiji

(Last updated: 22 Aug 2008)

Trends and opportunities

The market

Australia supplies approximately 39 per cent of the total food and beverage market in Fiji, and shares a position of preferred supplier along with New Zealand.

In 2007, the total food and beverage import for Fiji was valued at A$208.6 million. Of this total, A$158.4 million was for the grocery retail sector and the balance supplied to processing and the food service sector.

With a domestic population of 870,000, Fiji imports the majority of its food and beverage requirements. There is a small and relatively concentrated food processing industry with retail and food service being the larger volume sub-sectors.

The grocery retail sector is the largest sub-sector, three times the size of the food service industry. The retail sector is relatively fragmented with four main players, the largest of which is Morris Hedstrom. Close to half of Fiji’s population lives in the greater Suva area thus it is this geographic region that dominates retail sales. Suva also is a hub for the Pacific Islands with a number of regional institutions and corporate that service the Pacific islands based in Suva. As a result there is also a small but notable expatriate community.

Importation of food and beverage for the food service sector primarily targets the tourist trade. Fiji has over 500,000 tourists visit each year with the majority from Australia and New Zealand. The majority of the resorts catering for the tourist trade are found in the west of Fiji around the Nadi/Coral Coast area.

Key product categories that Australia supplies to Fiji are:

• Frozen meat
• Deli range 
• Confectionery
• Spices
• Dairy
• Wine and beer
• Fresh produce
• Canned fruits
• Sauces and spreads
• Health bars

Australia currently supplies approximately one-third of the fruit and vegetables exported to Fiji. Those that are most commonly imported include:

• Fruit – apples, oranges, grapes, pears, watermelon, plums, dates, nectarines, peaches and nashi pears.
• Vegetables – tomatoes, carrots, garlic, onions, potatoes, peas, dried legumes, celery, capsicum, cauliflower, broccoli, cabbage, beetroot, lettuce, asparagus, turnips and parsley.

Australian remains Fiji’s largest supplier of imported wines by a huge margin – approximately 70 per cent of the total market. The wine market is very competitive and wine importers are constantly being presented with new brands. Pricing seems to play a major role in deciding which brands to carry.

A number of newly imported beverages are appearing in supermarkets and convenience stores. Prices are quite competitive. A well priced product requiring a good distributor in the market can assist in promoting and growing the brand locally.

Opportunities

Whilst Fiji presents a broad range of supply opportunities, the best opportunities in Fiji’s food and beverage industry for Australian exporters are:

• Australian lamb and beef for the hospitality and food service sector. 
• Fresh fruit and vegetables.
• Retail pack cheeses, yoghurt, bulk butter, bulk powdered milk.
• Consolidated shipments of general foodstuffs for retail sector.
• Introduction of new lines with well-planned marketing strategy.
• Beverages – aerated beverages and natural waters, beer, wine, spirits and liquors, equipment.
• Accessories including packaging and flavouring.

Competitive environment

Australian suppliers face competition in a couple of key product categories from local and New Zealand supplies. In particular, Australian suppliers will face stiff competition from domestic players in the soft drinks, bottled water, snack products and spread lines.

New Zealand produce is widely found in Fiji, especially fruit and vegetables, dairy and meat. New Zealand wines are also increasing in popularity.

Tariffs, regulations and customs

There is recognition of food standard complying with New Zealand and Australian standards. 

Tariffs range from zero to 27 per cent. The high tariff of 27 per cent duty is in place to protect the local manufacturing industry. Some of the products that come under this category are butter, UHT milk, mineral water, jam, etc.

All imports attract Value Added Tax (VAT) of 12.5 per cent. Excise taxes of 15 per cent are levied on alcoholic beverages (and tobacco products).

Onions and garlic (including leguminous vegetables) don't have import duties. However, other import duties include:

• Fruit – 3 to 10 per cent
• Vegetables – 3 to 27 per cent
• Potatoes, onions and garlic – none
• Split peas – 15 per cent (to protect the local split pea processor, Dawn Industries)

Import duties are applicable for the following beverages:

• Water – mineral aerated and non-alcoholic beverages excluding fruit juices. The import duty is 27 per cent.
• Fruit juices – 15 per cent.
• Beer made from malt of alcoholic strength 3 per cent volume or less has an import duty of 27 per cent. If it exceeds 3 per cent volume, the import duty is $2.04 per litre.
• Wine of fresh grapes including fortified wines and sparkling wine of alcoholic strength 1.12.5 per cent or less has an import duty of 27 per cent. If it exceeds 1.12.5 per cent volume, the import duty is $4.31 per litre.
• Other wine - grapes must be fermentation prevented or arrested by the addition of alcohol. Two litres or less with alcoholic strength 1.12 per cent volume or less, has an import duty of 27 per cent. If it exceeds 1.12 per cent volume, the import duty is $3.82 per litre.
• Vermouth and other wine of fresh grapes flavoured with plants or aromatic substances - the same duty as for 'other wine'.
• Other fermented beverages - cider, perry, mead, ginger beer and herb beer. Mixtures of fermented beverages and non-alcoholic beverages not elsewhere specified of an alcoholic strength 1.12.5 per cent volume or less, has an import duty of 27 per cent. If it exceeds 1.12.5 per cent, the import duty is $2.64 per litre.
• Undenatured ethyl alcohol of alcoholic strength less than 80 per cent volume has an import duty of 27 per cent.
• Spirits, liquors and other spirituous beverages including cognac, brandy, whiskies, rum and tafia, gin and geneva, vodka of alcoholic strength of 80 per cent volume or less has an import duty of 27 per cent.
  If it is 57.12 per cent or less alcohol strength, the duty is $43.26 per litre.
  If it exceeds 57.12 per cent volume it is $75.76 per litre.

Industry standards

Fiji’s Ministry of Agriculture, Ministry Health and the Ministry of Trade and Commerce are currently working together to administer a Food Security Bill, which incorporates Codex Food Standard in Fiji.  The bill also looks at regulations in place for labelling and packaging of food products.

Health and quarantine regulations are in place for most food products, especially meats and fresh produce.

The Ministry of Agriculture’s Quarantine department is responsible for quarantine regulations. Frozen chicken and all chicken by-products are not allowed into the country, such as baby foods with chicken or eggs. Honey is also not allowed from Australia.

Fruit and vegetables are required to be grown and packed in an area not less than 80 kilometres from areas where species of fruit fly exists. Otherwise the product has to be subjected to dimethoate dip treatment. This also applies for citrus exports; otherwise fruits have to be subjected to cool storage for 14 days at 0°C prior to shipment.

All beverage products in Fiji require the use-by-date and details of contents on packaging, especially fruit juices.

For packaging and labelling requirements, please refer to:

• National and Trade Measurement Decree
• National and Trade Measurement (Pre-Packed Articles) Packaging Regulation 1989
• Health Department regulations

Confirmation on tariffs and product descriptions are available through:

Fiji Customs Service
PO Box 175, Suva Fiji
Tel: +679 330 322
Fax: +679 330 2864

Marketing your products and services

Market entry

A few key points to note when entering the Fiji food and beverage market:

• Exporters who are able to export in small volumes at regular intervals could easily penetrate the market as orders are relatively small
• Competitively priced and innovatively packed products can easily find a spot in Fiji
• Identification of appropriate distribution channels to sell, service and promote products in Fiji
• Visit the market and develop relationship with customers
• Have the drive to remain focussed and be patient

Buyers want to see the product, its colour, feel and taste it before they can commit to buying.

Some may want to do a trial shipment to test the market and gauge interest level before consistent supply is established.

Most beverage manufacturers are represented by agents/distributors with sufficient stock being held for short-term needs. Agents/distributors rely on suppliers being able to restock at short notice.

A variety of promotional options are available from print, television and radio advertising to in-store events and sports sponsorships. Wine tastings are becoming more popular with the expatriate and local communities.

Exporters should consider trade shows such as Expo in Suva and the HOTEC exhibition to promote products. Exhibiting at HOTEC held yearly is recommended. This is the only exhibition in Fiji that focuses on the hospitality sector.

Prices for imported beverages are calculated from a FOB/CIF base plus duty and other charges, such as handling. Margins range from 15 per cent to 25 per cent.

Industry payment terms are 30, 45, 60 day telegraphic transfer or cash on delivery.

Distribution channels

A number of food distributors are available to service either the supermarket/retail business or the food service sector.  Not all distributors have warehouses.  At present there are only a handful of cold storage food distributors.

Overseas products are imported by wholesalers or direct by retail outlets. Some manufacturers also import to supplement their locally produced range.

It is normal practice is for wholesalers and manufacturers to deliver to clients. Retailers may also collect from manufacturers or wholesalers depending on individual arrangements.

Supermarket chains carry out their own distribution.

Transport

Packaging has to be right to withstand the long sea or air journey between Australia and Fiji and still look presentable.

Contact details

The Australian Trade Commission (Austrade) is the Australian Government’s trade and investment development agency, operating as a statutory agency within the Foreign Affairs and Trade portfolio.

Austrade assists Australian businesses contribute to national prosperity by succeeding in trade and investment, internationally, and promoting and supporting productive foreign investment into Australia.

Austrade:

• Delivers services that assist Australian businesses initiate, sustain and grow trade and outward investment.
• Promotes Australia as an inward investment destination and, with the States and Territories, supports the inflow of productive foreign direct investment.
• Administers the Export Market Development Grants scheme.
• Undertakes initiatives designed to improve community awareness of, and commitment to, international trade and investment.
• Provides advice to the Australian Government on its trade and investment development activities.
• Delivers consular, passport and other government services in designated overseas locations.

A list of Austrade offices (in alphabetical order of country) is available.

More information

For further information please contact Austrade on 13 28 78 or email info@austrade.gov.au

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