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Food Processing, Organic Farming and Food Retailing to Experience High Growth in the GCC, says Frost & Sullivan


November 26, 2014 - Dubai, United Arab Emirates

Marginal farming activities owing to limited water resources and climatic conditions, make GCC countries primarily dependent on food imports. According to a recent Frost & Sullivan analysis,    70 per cent of food products in the GCC are imported of which cereals comprise around 55 per cent of total food imports. Imported foods are locally processed for consumption and re-export, creating opportunities for allied industries like processing machinery, packaging and logistics.
 
According to Aparajith Balan, Program Manager, Chemicals and Foods Practice, Middle East and North Africa,  Frost & Sullivan, “With an increased focus on local food processing so as to decrease dependency on imports and increase value to cost, the Food processing industry in the GCC is set for high growth. Also, about 54 per cent of the population in the GCC is under the age of 25, making the region a potentially favourable market for products such as biscuits, snacks, and confectionery items”.
 
As per Frost & Sullivan, the GCC packaged food industry was valued at USD 25 Billion in 2013 and is projected to increase at a Compound Annual Growth Rate (CAGR) of 8.5 per cent till 2018. Bakery products alone contribute to 30 per cent of the total packed products market, followed by dairy at 25 per cent. The top players in the GCC Packed food market are Almarai Co. Ltd. with around 9 per cent market share, followed by Nestle Saudi Arabia at 5 per cent and Danone Group at 4 per cent.
 
Organic farming industry in the GCC is growing as a result of raised awareness levels. The market for organic food is estimated to reach USD 1.5 Billion by 2018. The GCC Governments are taking active initiatives like establishing organic farming department in the ministry of agriculture and organic Farming Association to develop local farms.
 
Food retailing is also a thriving market in the GCC and is estimated to be worth USD 155 Billion by 2018. As customers’ exposure to global markets is increasing, their preference is also growing towards more options. This is leading to growth of organised food retailing in the GCC. Increasing health awareness and consumer preferences expected to create an opportunity for innovative food retail formats.
 
Healthy and innovative packaged foods, organic fresh produce like fruits and vegetables, meats, dairy and poultry, and selling these products at ergonomically designed innovative retail spaces are the segments presenting attractive growth opportunities in the GCC food and beverage industry. However, diversification and integration within the food industry ecosystem, and branding will remain key success factor in the long-term.
 
If you are interested in more information on Middle East Food and Beverage Industry, please send an email to Paroma Bhattacharya/  Tanu Chopra, Corporate Communications at paromab@frost.com / tanu.chopra@frost.com with your full name, company name, job title, telephone number, company email address, company website, city, state, and country.
 
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Source: Business Wire India

BusinessWireIndia

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