Richie Santosdiaz takes a deep look into the United Arab Emirate’s (UAE) thriving food industry in the wake of the upcoming Gulfood – the biggest food and beverage trade show in the world.
The food industry is the second largest sector in the country, important generally for the local UAE, across the GCC, as well as for the region which is undergoing large-scale economic development and diversification – some the notable ones include Saudi Vision 2030 and UAE Centennial 2071. In 2016, total food sales were Dh121 billion ($32.9 billion).
According to Mena Research Partners estimates, the food and beverage market in the GCC will grow around 7.1 per cent annually, reaching $196 billion (Dh719.3 billion) in 2021 from $130 billion (Dh477.1 billion) from 2018. Across follow GCC countries, Saudi Arabia will account for over half of this spending followed by the UAE at 31 per cent.
Despite tough competition in the UAE’s food & beverage market, according to a partner and head of retail at KPMG Lower Gulf, the medium-term outlook looks strong – thanks to Expo 2020 and other global events in the region should provide reasons for a positive outlook as the country continues to evolve as a tourist destination. The UAE, in particular, Dubai, has made itself a major destination in the Middle for the food & beverage industry – attractingboth foreign direct investment (FDI) and also local companies.
KPMG in its report highlighted that the restaurant footprint of UAE, specifically Dubai – which is measured by the number of restaurants/food & beverage outlets per million population – does compare well with other established global food and beverage markets, which includes Paris, London and New York City. Taking overnight visitors into consideration, Dubai would have more outlets per million than New York City, highlighting Dubai’s positioning as a global food & beverage destination.
The UAE boasts a favourable environment for the food & beverage business, this according to the BMI Risk/Reward index, having the UAE rank first in the region and fourth globally in food & beverage investment environment attractiveness. Imports net of re-exports in the food & beverage sector was around 43 billion AED in 2017 with a domestic consumption size of 112 billion AED. 69 billion AED of consumption came from the local manufacturing industry, meaning 62% of the domestic food & beverage needs derived from the UAE’s local manufacturing industry. According to the same report from Dubai Exports, the UAE’s food & beverage industry is by far one of the most important manufacturing sectors in UAE with many starting operations as far back as the early seventies. Many companies have expanded and developed over the years since then.
Despite the UAE importing most of its food, food security and promoting locally-made products is also important. For instance, thanks to the government’s strong focus on agriculture, the country is now over 80% self-sufficient for milk and almost 40% self-sufficient in its demand for eggs, according to BMI research.
Host to many world-class events and gatherings, Dubai hosts the annual Gulfood – now the world’s largest annual food & beverage trade exhibition – this year, from February 17-21 2019 at the Dubai World Trade Centre. Spanning more than 1,000,000 square feet of F&B products and showcases, Gulfood welcomes over 98,000 attendees from 193 countries.
Gulfood 2019 will have some of the world’s top delegates including ministers from different countries, government officials, mega brands, new-to-show exhibitors and industry professionals who see Gulfood as a truly unique platform linking every aspect of the global food supply chain. There are eight show sectors: beverages; dairy; fats & oils; health, wellness & free-from; meat & poultry; power brands; pulses, grains & cereals; and world food.
Gulfood is such a global show it now, for many in the food and beverage space, has its coveted place in the crème of the crème of major global food shows – which include the likes of the biannual food shows like ANUGA in Cologne, Germany and SIAL in Paris. To note, the latter has its own regional version in Abu Dhabi called SIAL Middle East.
With world fresh food sales set to rise by 13% by 2020 – equating 280.5 million tonnes in volume, opportunities in this fast-moving sector are ripe across the globe – according to Gulfood report. The upcoming Gulfood will definitely showcase the UAE’s growing strength in the sector, as well as the latest trends and innovation happening globally; a good part of which much is increasingly happening across the GCC.