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Halal Foods Market taking wide customer base globally

Halal food is a large segment serving the global Muslim population, while also gaining attention of a wider global audience. The Halal market has, for many years, been uncharted territory. In terms of market research, trade data and analysis, and the preferences and spending habits of 1.6 billion consumers, the halal marketplace is still a very young, continually evolving commercial arena. It is, in effect, a new market paradigm that crosses geographic, cultural and even religious boundaries. To meet the Halal requirement, food producers are encouraged to follow the standards that in line with global benchmarks, such as ISO-9000, Codex Alimentarius, QA, HACCP, GHP, and Standard Operating Procedures (SOPs). There is increasing interest globally in organic and natural food products, which represents a strong adjacent market for Halal food products to address. This has also opened the door to merger and acquisition activity outside the traditional Halal distribution chain to access both Muslim and non-Muslim consumers.

Halal food products are not confined to meat and poultry, including other food items, such as confectionary, canned and frozen food, dairy produce, bakery products, organic food, beverages, and herbal products. The Halal market has witnessed a universal shift in the demand and supply chains of Halal food products. They are increasingly made available in Western-style grocery stores including supermarkets and hypermarket chains. In many western countries, supermarkets and food producers are starting to reach out to Muslim consumers by offering a wider selection of Halal food products.

From a market perspective, the traditional major target markets remain in Asia-Pacific and the Middle East. However, Halal markets in the UK, Europe, and the USA will see their roles in the development of the Halal market significantly enhanced, as they are markets that play defining roles in other markets around the world. It will bring Halal into the global mainstream. As the dynamics within the Muslim world change and globalization trends continue to shape consumers’ tastes, habit, and spending patterns across the world; it is highly likely that the developing Halal markets will have increasingly influential roles in the established markets of the Middle East and Asia, particularly by influencing global corporate Halal strategies.

The global Halal food industry is a fragmented market with several companies such as Nestlé, Kellogg, Glanbia Cheese Ltd, Guenther Bakeries UK Ltd, Kellogg’s Supply Services (Europe) Ltd, Royal Unibrew A/S, Coco Cola etc. operating in multiple geographies. Nestlé solely constitute around 35 percent of the overall industry revenue. The absence of a single international certification and difference in standards in different countries is a major concern faced by the industry players currently.

 

Major players
  • Al Islami Foods
  • QL Foods
  • Saffron Road Food
  • Dagang Halal
  • Janan Meat
  • Kawan Foods
  • Cargill
  • Prima Agri-Products
  • Nestle
  • BRF
  • Al-Falah Halal Foods
  • Tahira Food
  • One World Foods

In the recent past, following major investments have been made in the food and agriculture sector of Pakistan:

  1. Acquisition of Engro Foods by Dutch company Friesland Campina for USD 460 million in 2016.
  2. Cargill to expand its footprint in Pakistan with over $200 million investment.

Cargill started its Pakistan operations in 1984 and today has business interests in refined oils, animal feed, grains & oilseeds, cotton, sugar and metals. Cargill is one of the largest suppliers of palm oil and soybeans and cocoa powder to Pakistan. With the head office in Karachi, Cargill currently employs 50 people in Pakistan. Cargill has announced plans to invest more than $200 million in Pakistan over the next three to five years. The funds will be used to expand Cargill’s agricultural trading and supply chain, edible oils, dairy, meat and animal feed businesses in the country. Additionally, the company has earmarked funds for safety and food traceability efforts.

The writer is a Karachi based freelance columnist and is a banker by profession. He could be reached on Twitter @ReluctantAhsan

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