Wednesday 18 December 2013

SALES & MARKETING TRENDS: Halal Food Trends

Global Pathfinder Report

 Halal Food Trends 

The international Muslim population is comprised of nearly 1.6 billion people who, as part of their Islamic religion, follow a Halal diet (Carnegie Endowment for International Peace). The sheer size and scope of this market presents a promising mosaic of consumers for food manufacturers.


There are two key drivers that make the Muslim population an increasingly important market. The first simply comes down to the numbers. It is estimated that Muslims account for about 25% of the global population, and the Muslim population is younger and growing faster as a whole, increasing at a rate of 1.8% per year (Carnegie Endowment for International Peace). The second is the changing nature of the world market. The Muslim population is gaining influence and economic clout, with the gross domestic product (GDP) of most Muslim countries growing faster than in the West.

Compounded by new immigration, there are large amounts of native Muslims around the world. These second and third generation Muslims show the same consumer inclination to opt for convenience rather than cooking from scratch. They are also looking to expand the range of cuisines traditionally favoured by their elders. These changing trends not only promise a growing demand for Halal foods, but also make a market ripe for new product developments.

Halal Traditions

Within the Islamic religion, a strong emphasis is placed on cleanliness, both spiritually and in the context of
food and drink. For a food and drink product to be approved for consumption it must conform to the Islamic dietary laws as specified in the Quran (Holy Book). Halal and Haram are universal terms that apply to all facets of Muslim life

Halal is an Arabic term meaning ―permissible‖ or ―lawful.‖ The opposite of Halal is Haram, which means
―prohibited‖ or ―unlawful.‖ Health is a key characteristic embedded in all the teachings and instructions of
Islam; followers are taught that anything Halal will lead to good health, whereas anything Haram will lead to
some form of disease and suffering.

In regards to food and drink, Islamic scholars have laid down three guidelines:

1. Consumption must include only Halal food and food products.
2. The food and food products must be obtained through Halal means.
3. The material in contact with the food or food products must not be harmful to health.

Halal products are determined based on their purity and cleanliness, and while the particular standards may
have regional or other complexities, there are some primary instances of non-Halal, or Haram products,
including:
pork and all swine by-products,
animals that are not slaughtered according to Halal requirements,
animals that have been killed prior to slaughter,
animals slaughtered in the name of anyone other than God,
carnivorous animals or birds of prey,
blood and blood by-products,
alcohol and intoxicants, and
otherwise Halal foods that have been contaminated by any of these Haram
products.

In 2009, the global food market was valued at US $3,992.2 billion (retail plus trade), and according to the latest
research from the World Halal Forum, the global Halal food market is worth an estimated US $635 billion. The
Halal market in Europe alone represents US $67 billion, highlighting that the Halal food market in non-Muslim
countries is substantial. Non-Muslim countries offer huge opportunities for Halal food producers.

The 1.6 billion global Muslim population largely resides in countries where the economy is growing, enjoy
higher income levels, and report higher expenditures on good-quality Halal food, creating substantial marketing
opportunities for Halal food products. Also, while developed countries are seeing declining populations with
shrinking families, Muslim nations are seeing rapid growth and larger families. Both of these trends are fuelling
further growth amongst Halal products.

According to the Halal Industry Development Corporation of Malaysia, among all Halal products on a global scale, 10% is represented by meats, and 35% is processed food and non-alcoholic beverages. Value-added beef products and deli are classified within the processed food category, which also includes a wide variety of other products, such as cookies, candies, and so on. The remaining categories, such as dairy or fresh produce, are fragmented and proportionally small by comparison.

While many things are clearly Halal or Haram, there are some items that are not so easy to classify, and these are often referred to as mashbooh, which means ―doubtful‖ or ―questionable.
The International Halal Food Market: Characteristics and Challenges 
 
According to the World Halal Forum Chairman (for 2008-2007) Mr Khairy Jamaluddin, one of the things 
impeding growth in the Halal industry, despite rising consumer demand for Halal products, is the lack of 
international consensus in regards to Halal standards. There are several competing bodies offering Halal status 
certification, and certification fees differ substantially. Furthermore, in almost all countries Halal is a religious 
issue and thus the state will not intervene in its control or standardization. Halal certification, therefore, is 
conducted by many independent agencies, associations, councils, and federations, and is regulated under 
labelling law. 
 
However, Halal markets are not necessarily similar across different countries or regions - each market is 
fragmented by ethnicity, location, income, and various other determinants - posing further challenges to the 
idea of international standardization, as well as the producers and exporters of Halal products. Furthermore, 
most Muslim countries, especially those in Asia and Africa, still rely on basic and non-tradable food products which are largely supplied locally and not internationally exchanged. 
 
The concept of Halal does hold a sort of universal meaning, and while Halal certification is a necessity, it is 
insufficient on its own to succeed in international trade due to the inconsistencies in terms of standards 
mentioned above. Halal products must also hold up to world-class standards of quality, safety, packaging and labelling. It has been observed, for example, that most imported Halal products in the Middle East have failed due to poor packaging, inconsistent supply and lack of sustained branding. Equally important, integrity within the Halal supply chain must be preserved. If consumers lose confidence in the status of Halal, sales and trade will be affected. 

Although we tend to think of Muslim countries as being centered in the Middle East, the 
largest Muslim nations are actually located in South and South-East Asia. Countries with a 
Muslim majority are the most obvious target markets for Halal products. However, Muslims living within 
Western countries also present strong demand for Halal products that suit a convenience-oriented lifestyle, thus creating many opportunities for Canadian suppliers of Halal products. 



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