Despite recent surge, halal market still has huge long-term potential
With a prospective customer base of some 1.6bn Muslims, US$1.9tr was spent last year on Islamically permissible goods and services. Experts believe the halal industry is among the best examples of an Islamic economy that has far-reaching, cross-cultural engagement with consumers and manufacturers.
According to experts speaking at this year’s Global Islamic Economy Summit in Dubai, there has been a positive shift among non-Muslims regarding halal food in recent years as changing consumer behaviour places its focus on a food’s quality and provenance—both central to halal’s principles.
The industry has taken vast strides to encourage consumers to be more willing to ask about the source of their food, said Mohammed Badri, managing director at the Dubai-based International Halal Accreditation Forum, which has set out to make the UAE the global centre for halal certification.
“Greater co-ordination and standardisation globally about what constitutes halal food is a barrier that can, and needs to be, overcome in the coming years to ensure that the sector’s full potential is reached in the Islamic world.”
Counterintuitively, while a number of non-Muslim countries have recognised the opportunities and established robust supply chains, Muslim markets are still net importers of halal food. At present, the Organisation of Islamic Cooperation countries import as much as 50% of their vegetable products, 32% of processed foods, and 18.5% of animal products.
The head of Dinar Standard said there was a perception in western markets that halal was synonymous with healthy food.
“The industry needs to be ready to capitalise on this, as it is a positive association for the Islamic faith. Muslim countries in particular need to try and become better at producing halal food as there is a huge opportunity on offer which is currently being seized by countries such as Brazil and Australia,” said the research and advisory firm’s managing director, Rafu-uddin Shikor.
The future looks extremely bright for halal food manufacturers, with young people “extremely engaged in [Islamic] matters” beyond food, according to the chief executive of Britain’s Halal Food Authority.
Business segments such as halal restaurant chains and hotels are waiting to be tapped, said Saqib Mohammed. “Better collaboration and an international standardisation of halal products will help to catalyse the sector for future growth.”