Home Countries World: GCC countries rely on food imports, finds report

World: GCC countries rely on food imports, finds report

SHARE

Marginal farming activities owing to limited water resources and climatic conditions, make Gulf Cooperation Council (GCC) countries primarily dependent on food imports.

According to a recent Frost & Sullivan analysis, 70% of food products in the GCC are imported of which cereals comprise 55% 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.

“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,” says Aparajith Balan, program manager, Chemicals and Foods Practice, Middle East and North Africa.

“Also, about 54% of the population in the GCC is under the age of 25, making the region a potentially favorable market for products such as biscuits, snacks, and confectionery items”.

The GCC packaged food industry was valued at US$25 Billion in 2013 and is projected to increase at a compound annual growth rate (CAGR) of 8.5% till 2018.

Bakery products contribute to 30% of the total packed products market, followed by dairy at 25%.

The top players in the GCC Packed food market are Almarai Co. Ltd. with about 9% market share, followed by Nestle Saudi Arabia at 5% and Danone Group at 4%.

Organic farming industry in the GCC is growing as a result of raised awareness levels.

The market for organic food is estimated to reach US$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 US$155 billion by 2018.