Global Demand For Halal Products Reveals Opportunity

By Isaac Fletcher, contributing writer, Food Online

With a large and growing Muslim population, producers outside of the Muslim world are looking to capitalize on the chance to become players in the halal foods market

The global industry for halal food (food that adheres to Islamic law standards of manufacturing) is estimated to be worth hundreds of billions of dollars. Last month, United Arab Emirates (UAE) officials announced that Dubai has dedicated 6.7 million square feet of land in Dubai Industrial City to become a hub for the manufacturers and logistic companies in the halal industry. This move effectively postures the UAE to become the gateway for global halal producers seeking market share in the Muslim world.

With a global Muslim population of around 1.6 billion, the majority of which is believed to prefer halal products over others, there is a great opportunity for halal producers and the UAE alike. Abdullah Belhoul, Dubai Industrial City CEO, states that the halal industry is growing and expected to double in value within five years. He goes on to say, “We think there is a lot of opportunity, and we need to capitalize on this.” Halal food already accounts for about a fifth of world food trade, and with projections showing that the Muslim population will continue to grow, the demand for halal products is not going anywhere any time soon.

In general, halal foods should not be contaminated with pork or alcohol and livestock must be slaughtered in accordance with Islamic Shariah law. However, depending on who you ask, the extent to which these standards must be met varies greatly. There are no standardized, worldwide guidelines for halal certifications despite attempts by international Islamic bodies to create a system for certification. Halal foods manufactured in the UAE need to be halal certified by a government body, but with halal products or raw materials imported from abroad, it is up to the exporting country to give the halal stamp of approval. Organizations like Halal Control in Germany were created to do just that.

Halal Control was created 14 years ago when there was little awareness or demand for halal products. It has since grown and now employs 12 Islamic scholars who offer guidance on certifications to international companies that want to do business in the Muslim world. This kind of oversight is important, since in some cases Muslims may think they are receiving a halal product, but in reality, the raw materials may not meet halal standards due to contaminations from alcohol or pork. There are around 30 halal certification bodies in the U.S. and a handful of large supermarket chains that carry halal food items.

Producers from a variety of countries are seeking ways to capitalize on the opportunity presented by growing halal demand. U.S. manufacturers such as Kelloggs and Hershey have plans to develop halal-compliant plants in Malaysia, which is the global leader in the developing halal industry with $9.8 billion worth of halal exports in 2013. Indonesia plans to develop a center for the halal industry in 2015 and in Thailand, more than 25 percent of food plants are already meeting halal standards.

The Gulf shows the largest potential for halal industry growth since countries in that region depend heavily on food imports, but even in markets where Muslims are not the majority, there is the potential for billions to be made in the halal industry. The Islamic Food and Nutrition Council of America estimates the domestic U.S. halal market is valued at about $20 billion.