Set for Expansion, Growth & Innovation

The food demand in Middle East and North Africa (MENA) region is driven by several factors including a growing population, increasing affluence in the Gulf Cooperation Council (GCC) countries and rising tourist inflow within the region. The region is investing its efforts to ensure food self-sufficiency and food security. However, the agricultural sector in the MENA region is limited due to climate change, harsh temperatures and water scarcity. Consequently, the GCC governments have been financing fish farming initiatives to boost domestic seafood production and meet the rising demand. On the other hand, packaging is witnessing a significant shift in the MENA region due to convenience and increasing demand for packaged food.

Food Consumption is Booming

Changes in consumption patterns in MENA region, associated with urbanization and the nutrition transition produce large public health and agro-ecological depletion challenges, according to a recent report by United Nations Environment Program (UNEP). As Egypt grew in population and its people became increasingly urban, a nutrition transition occurred. The percentage of imported foods from developed markets increased, as did major investments in the agricultural sector, particularly in the form of high input, resource-intensive agriculture on the 4 percent of land that is cultivable in the country. Furthermore, the GCC region’s abundant oil revenues have supported its food imports as well as enabled the governments to make multi-billion dollar investments toward improving the country’s food security, according to a recent report by Alpin Capital. Saudi Arabia is the largest food consuming nation in the GCC, and is anticipated to remain so for the foreseeable future. Food consumption in Saudi Arabia is projected at 31.1 million metric tons (MT) in 2019.

Fisheries in GCC: A Promising Market

Despite being low on water, the GCC is rich in terms of fisheries resources. The region is surrounded by a large number of seas and gulfs, including the Gulf of Aden, the Red Sea, the Arabian Gulf, and the Arabian Sea, according to a recent report by Mordor Intelligence. Fish consumption in the GCC is estimated at 10 kg per person per year, with UAE on top in the regional rankings in the consumption of seafood with 33 kilograms per person. Population growth and rising affluence means increasing demand for fish, and it is projected to grow at around eight percent a year up to 2030, reaching 900,000 tons by that year in the UAE. Fish supply in GCC countries must increase 20 percent to meet the region’s current levels of consumption. In two years’ time Oman will become home to one of the biggest aquaculture facilities in the GCC. The USD80 million project will involve inland aquaculture, cage farming, and Mari culture. The farm is to produce 3,000 tons of fish in 2016; 8,000 tons in 2017 and 13,000 tons in 2018, this includes 10,000 tons of shrimp and 3,000 tons of tuna, cobia and sea bream.

Food Security: A Positive Outlook

According to the Global Food Security Index (GFSI) jointly released by DuPont, and the Economist Intelligence Unit (EIU), the MENA region has produced positive results, as its GFSI score saw an ascent by 0.1 points to reach a total rating of 62.1 points. Qatar, the UAE, and Kuwait were the top performing GCC countries in the Affordability category. Qatar landed the first slot in the world, followed by the UAE (3rd) and Kuwait (6th). All three are high-income countries with a low prevalence of poverty and plenty of public money flowing into their small agricultural projects.

Convenience & Innovation Boost Packaging Demand

The packaging market in MENA is very dynamic in nature. The packaging industry sector in the MENA region has been forecast to grow to USD52.4 billion by 2019, according to market research by Smithers Pira. Urbanization and change in consumer lifestyles have propelled the demand for packaging solutions that are light in weight and have greater visual appeal, reveals a report by Technavio. The market has also witnessed a considerable shift in the purchasing patterns of customers, with customers demanding more flexible packaging solutions over rigid packing. Growing demand for dairy products, which has led to an increase in dairy products packaging, has also fueled the growth of the market.

MEF Content & Research Team