With a growing appetite for halal foods and healthy but conveniently packaged items, the UAE’s fast-growing food and beverage industries are a magnet for opportunity – particularly in the start-up and franchise arenas.
More than 5,000 companies from 120 countries are hoping to cash in on this market at the region’s largest food exhibition in Dubai this week. Gulfood 2016, which begins today at the Dubai World Trade Centre, hopes to attract over 85,000 visitors, says Exhibitions Director Mark Napier. A wide range of produce is on show. For example, Poland will feature cream fudge, pastry fillings and a variety of apples. “It’s a far cry from the 65 exhibitors from 13 countries and 1,600 trade visitors that attended the first Gulfood some 28 years ago,” he adds.
Hungry sector
That growth is in line with the UAE’s new-found status as a tourist hotspot. “Despite economic uncertainty in many parts of the world, the UAE welcomes millions of tourist every year and its residents embrace the culture of dining out,” says Napier.
A report by global auditor KPMG expects the UAE’s food and beverage sector to grow by 4 per cent annually to $13.2 billion (Dh48 billion) in 2018. This matches with expected regional food consumption growth of 3.5 per cent CAGR between 2014 and 2019. The number of outlets in the UAE is set to double by 2020 when Dubai welcomes 20 million tourists for Expo 2020, Napier adds. As more new restaurants pop up across the country regularly, the UAE is emerging as a franchise hub. “This global segment is geared for annual growth of 7.4 per cent over the next four years and I believe this region will contribute heavily towards it,” he says, citing Euromonitor International data.
“These opportunities appeal to both the region’s food service industry and thousands of international catering and hospitality equipment suppliers looking to increase their regional sales.”
Manufacturers are also spending on evolving industry trends such as convenience foods, halal products and healthy solutions for the 24/7 lifestyle, he says.
“The region is bearing witness to relentless urbanisation and there is an increased demand for convenient food options. Demand requires product and international food producers have homed in on the UAE’s thriving convenient foods market.”
Health in focus
Conversely, the demand for easy solutions is accompanied by greater emphasis on healthy food. Napier expects pulses, a traditional dietary staple across the region, to return to prominence with the UN Food and Agriculture Organisation working to raise awareness on their benefits and boost global production in its International Year of Pulses.
“With the Gulf’s organic food market anticipated to reach $1.5 billion by 2018, the popularity of healthy options mirrors the regional increase in healthy, organic and dietary food consumption,” he says.
Two sectors drawing unlikely investment here in the desert are aquaculture and sustainable farming. “Whether it’s the widespread increases in regional farming or GCC governments’ investment in fish aquaculture projects, the region’s expansive food sustainability initiatives constitute definite progress,” Napier says.
“Some of these initiatives are at the cutting edge of global innovation — Saudi Arabia and Oman are among the largest per capita aquaculture sector investors, and the widespread use of hydroponics and aquaponics is boosting regional agricultural production. More can be done but progress is being made.”
Another big trend is the rise of the halal sector as consumers demand exciting lifestyle-compatible options. Halal makes up a fifth of global food trade and is set to hit $2.537 trillion in value by 2019, from $795 billion in 2014.
In line with Dubai’s ambition to be a centre for the Islamic economy, Gulfood is catering to this lucrative sector by evolving its Halal World Food segment. Napier says the show-within-show has become the world’s biggest halal food sourcing trade event in only two years. About 800 halal-certified suppliers are attending this year.
Challenges
While there are several challenges ahead of the sector, Napier prefers to call them opportunities. Food security is a concern in a country that does not have geography conducive to self-sufficiency, but he feels the overdependence on imports opens doors for Gulfood to provide a specialised platform for the industry to network, see new products and trends, and trade out of Dubai.
Logistics is another opportunity, where the cost of the supply chain leaves a huge burden on consumers. “If industry can reduce the cost of transport we should see our grocery bills reduce,” he says. “This is the next great industry challenge, to improve supply chain efficiency.”
In numbers
21st edition
The show was first held 28 years ago. Gulfood 2016 is the biggest yet, spread over 120,000 sq m, including three new halls and two purpose-built structures.
117 pavilions
There are more than 5,000 companies from 120 nations, mostly organised by country. Russia, Mauritius, Costa Rica and Belarus are new pavilions.
1st time
A first for the Gulf is the ninth World Cezve/Ibrik Championship, where coffee
is brewed in a cezve or ibrik, a small long-handled pot.
3 days
A new knowledge-sharing event starts with the F&B Business Forum at DWTC today. Its Innovation Hub offers an opportunity for F&B entrepreneurs to pitch for seed capital. Tomorrow is the Gulfood Halal Forum, while sessions on food security and public health in the food sector run on Tuesday, both at the Conrad Hotel.
10 prizes
The Gulfood Awards are also back, shining the spotlight on excellence of individuals and companies in the region’s food and drink business. Judged by an independent international panel, the awards cover six categories and 10 accolades.
Taste tour
The Salon Culinaire offers demonstrations of new products and recipes — and the chance for UAE chefs to compete in the Emirates Culinary Guild showcase. This year will see more than 1,300 professional chefs take part.
In addition, several national pavilions are hosting events. One highlight is the Grand Tour of the US, helmed by Louisiana-born Joe Truex, of Dubai’s gourmet eatery Pi. “The menu will be a snapshot of the many different culinary styles and flavours of the US,” he says.
