ACU March 2022-LR

NEWS FEATURES
innovation (the production of animal-sourced foods from
cell culture methods) and emerging slow and plant-based
food trends.
GCC food consumption to reach 52.4
million metric tons
Food consumption in the Gulf region is anticipated to grow at
2.3 percent to reach 52.4 million metric tons by 2025.
The Gulf Cooperation Council, whose members include the
United Arab Emirates, the Kingdom of Bahrain, Kingdom of
Saudi Arabia, the Sultanate of Oman, Qatar and Kuwait, has
remained relatively conservative, growing at a slower pace
amid economic and geo-political concerns in recent years.
While demand has been supported by growing population
and evolving consumer preferences, the fall in per capita
income since the slowdown in oil prices in mid-2014 has led
to the growth of food consumption to remain flat between
2014 – 2019, according to the UAE-based investment
banking advisory firm, Alpen Capital’s latest report on GCC
Food Industry report.
The continuous collaboration between the public and private
sector and the ongoing efforts of the governments to
increase food security has helped the GCC nations build a
strong food ecosystem, withstanding the Covid-19
pandemic.
In 2020, the GCC consumed 46.8 million metric tons of food,
with Saudi Arabia and the UAE consuming a combined 77.9
percent due to greater population. Outside the two most
populous nations in the region, Oman, Kuwait and Bahrain
are forecast to grow at 4.2 per cent and 4.1 per cent taking
higher growth rates in the region.
Cereals will remain the staple food of the region, the report
predicts, albeit with much slower growth as most food
categories experience minimal change in share through to
2025. However, the ‘others’ food category comprising of
eggs, fish, pulses, oils and fats, potato and honey is expected
to witness the highest growth rate of 3.7 percent driven by
pandemic-led changes in eating habits.
“Food consumption in the GCC has been relatively stable in
the past years with a few lows and highs depending on the
economic situation. In terms of the type of food consumed,
staples such as rice, wheat and other grains have always seen
a steady to high demand, but in recent years, boosted by the
impact of the pandemic, we have also witnessed increased
sales in the health food category. Foods such as quinoa, chia
seeds, sprouted brown rice are quickly picking up demand
with the increasing percentage of health-conscious
consumers. Moreover, initiatives taken by the government in
line with food security, local production, and support towards
the health and wellbeing of the population has changed the
overall outlook and dynamics of the food sector in the
region,” said Priyanka Mittal, director, India Gate KRBL Ltd.
Photos Courtesy of Gulfood 2022
The onset of the COVID-19 pandemic coupled with highincidence
of lifestyle diseases is encouraging healthy food
habits in the GCC region, which has led to a boost in demand
for organic food, with consumers seeking more homecooked
dishes and plant-based products with high nutritional value.
Ready-to-cook packaged variants have grown in popularity with the
advent of global food retailers to the region, alongside demand for
private labels. With population estimated to reach 66.5 million by
2025, consumers have become increasingly price sensitive,
prompting large retailers to turn to private labels to safeguard
revenue.
“Over the past few years there has been a greater focus on enhancing
agricultural capability by implementing technologies like vertical
farming, aquaponics, hydroponics, etc. to improve self-sufficiency.
Many deals concluded as part of the region’s strategic plan to
improve food security and reduce dependence on imports.
Companies pursued the path of inorganic growth to focus on the
growing food demand in the region and thus expanding their
offerings. Going forward, food aggregators are expected to
transform the industry dynamics, and are likely to see traction as
consolidation is imminent in the backdrop of Covid-19 to ensure
survival,” said Sanjay Bhatia, managing director, Alpen Capital.
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