Lipton Egypt to invest EGP 100m in local market by 2026

Daily News Egypt

2 days ago

Islam Tarek, Head of Marketing at Lipton Egypt—one of the world's largest tea companies—announced that the company will boost its investments in the Egyptian market to EGP 100m by 2026, marking a 20% increase compared to this year. This expansion comes as part of a wider strategy focused on ramping up production, increasing exports, and strengthening cooperation with the public sector.
Tarek told Daily News Egypt that Lipton also plans to raise its supply of tea products to Egypt's Ministry of Supply by 5–7% in 2024. The Ministry currently accounts for over 15% of Lipton's sales in Egypt.
In April, Minister of Supply and Internal Trade Sherif Farouk met with company officials to discuss collaboration with the Holding Company for Food Industries. The meeting addressed ways to enhance supply chains, boost distribution efficiency, and ensure the availability of high-quality products at affordable prices, while drawing on the expertise of global brands like Lipton.
According to Tarek, Lipton aims to increase local production by 10% by the end of 2025 and by 15% in 2026, supported by growing domestic demand. Recent estimates show that nearly 99.8% of Egyptians drink tea regularly.
Since 1996, Lipton Egypt has operated a factory in Borg El Arab, Alexandria, with an annual production capacity of 25,000 tons across various tea products—including black tea, green tea, herbal tea, and fruit-infused tea. The factory serves both the local market and several export markets, notably Sudan, along with other African and Arab countries. As part of its regional expansion strategy, the company targets a 15% increase in exports by 2025 and up to 25% in 2026.
Tarek noted that Lipton holds over 50% of Egypt's single-serve tea bag market, maintaining its top position in this segment. Egypt remains the company's largest market in the region, followed by Saudi Arabia, which accounts for around 30% of its regional sales share.
As part of efforts to cut costs and improve supply chain flexibility, Lipton began sourcing herbs such as hibiscus, anise, and mint locally starting in the third quarter of 2023. Tarek said local herb production officially launched in the fourth quarter of 2023, contributing to a 46% rise in herbal product output within a year through better integration of local and imported supplies.
Although the herbal tea segment currently makes up only about 5% of Egypt's total tea market, it is viewed as a key growth area, driven by rising consumer interest in healthy and natural products. This shift offers Lipton significant potential to expand further in the herbal tea segment.
Tarek added that the company does not expect further price increases until at least the end of 2025, following a 35% price hike in April last year due to currency fluctuations. Despite a 3% slowdown in the local tea market amid inflationary pressures, Lipton managed to grow production by 20% and expects market growth of around 2–3% by year-end.
Currently, Lipton Egypt operates approximately 30 distribution centres and plans to expand this network soon. Alongside Egypt, markets including Saudi Arabia, the UAE, Qatar, Bahrain, Oman, and Turkey together represent about 18% of Lipton's global sales.
According to Egypt's Central Agency for Public Mobilization and Statistics (CAPMAS), Egyptians spent around EGP 13bn on tea in 2023. Separately, Menna El-Sharkas, General Manager of Lipton Egypt, previously noted that total annual tea sales in Egypt exceed EGP 30bn.
It is also worth mentioning that in 2021, Unilever sold several of its tea brands—including Lipton and PG Tips—to CVC Capital Partners for approximately €4.5bn. The deal included operations in over 100 countries, excluding key markets like India and Indonesia.