According to the Anti-Defamation League and the Southern Poverty Law Center, yes he did. There is no direct video evidence that Mr. Shabazz said the lines in question, but positions previously espoused by Mr. Shabazz are in line with the quote.
Both the Anti-Defamation League and the Southern Poverty Law Center quote Mr. Shabazz in saying the exact quote. However, there is no direct video evidence provided and there does not seem to be any direct proof of the event in question.
Anti-Defamation League, page 8
During an April 2002 demonstration the NBPP organized in front of the B'nai B'rith building in Washington, DC, Shabazz led chants of "death to Israel" and "Jihad," and shouted, “Kill every goddamn Zionist in Israel! Goddamn
little babies, goddamn old ladies! Blow up Zionist supermarkets!”
Participants held posters that read, “The American Israeli White Man is the Devil” and “The State of Israel Has No Right to Exist.”
Southern Poverty Law Center Profile on Malik Zulu Shabazz, In His Own Words
"Kill every goddamn Zionist in Israel! Goddamn little babies, goddamn old ladies! Blow up Zionist supermarkets!"
— Speech during protest of B'nai B'rith International, Washington, D.C., 2002
Malik Zulu Shabazz was (2001-2013) the former head of the New Black Panther Party. The NBPP is described by the Anti-Defamation League as
the largest organized anti-Semitic and racist Black militant group in America.
The Southern Poverty Law Center agrees with this sentiment.
The NBPP is notable for its anti-white and anti-Semitic hatred.
NBPP members also hold black-supremacist religious beliefs. Some think that blacks are God's true "chosen people" and that the people normally called "Jews" actually are impostors (this ideology is remarkably similar to the white racist theology of Christian Identity, which says whites are God's real chosen people). They believe that blacks are naturally superior to people of other races. In September 1997, Khalid Muhammad said that he could not be anti-Semitic because Jews had no claim to the term "Semite."
As an aside, the NBPP, despite its name, has no connection to the Black Panther Party of the 1960s, 70s, and 80s. Notably, the NBPP advocates for Black Supremacy, and is described as a racist organization by both the ADL and the SPLC, whereas the BPP was notably anti-racist. According to a web archive of the BPP website
Firstly, the people in the New Black Panthers were never members of the Black Panther Party and have no legitimate claim on the Party's name
Secondly, they denigrate the Party's name by promoting concepts absolutely counter to the revolutionary principles on which the Party was founded. (...) The Party operated on love for black people, not hatred of white people.
The Southern Poverty Law Center maintains a profile on Mr. Shabazz. In their brief description of him, they describe him as
(...) a racist black nationalist with a long, well-documented history of violently anti-Semitic remarks and accusations about the inherent evil of white people.
While there is no direct video evidence of Mr. Shabazz at the protest where he said the quoted lines, there is evidence of Mr. Shabazz holding antisemitic, pro-radical Islamic positions.
Mr. Shabazz claims that he is not antisemitic. However, he nuances this by being an advocate of the theory of Black Hebrew Israelism, a theory that states that some African Americans are descendants of the ancient Israelites. Shabazz takes this theory further and believes that modern day Jews are imposters.
Shabazz has also advanced the theory (...) that blacks, not Jews, are the original Hebrews of Israel.
This belief allows Mr. Shabazz to claim to not be antisemitic by claiming that the group of people commonly known as Jewish are not Semites, and therefore his speeches against this group are not antisemitic.
Shabazz has also advanced the theory, laid out by some black nationalists, that blacks, not Jews, are the original Hebrews of Israel.
Mr. Shabazz has also advocated for theories that the U.S. government and Jews (presumably what he describes as "fake" Jews) were responsible for the 9/11 terrorist attacks.
That same year, Shabazz notoriously appeared at a press conference alleging a Jewish conspiracy behind the 9/11 terrorist attacks and embarked on what was to be a long series of controversial protests.