Frost & Sullivan predicts Middle East food & drink boom

  • 8 June 2020
Increasing awareness and attempts by governments to curb the intake of unhealthy food items will push the demand for organic and balanced foods, the global consultancy firm has reported
MIddle East food and drink
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“Rising health awareness, product differentiation, and convenience of online food platforms are key factors to drive the food and beverage market in the Kingdom of Saudi Arabia and the United Arab Emirates,” said Prithvijit Roy, Food & Nutrition Consultant at Frost & Sullivan.

Frost & Sullivan, headquartered in California, is a management consulting firm with a global footprint.

The company predicted in its latest analysis on the Kingdom of Saudi Arabia (KSA) and the United Arab Emirates (UAE) that food and drink in these countries will experience steady growth this year, surpassing $80 billion.

“The overall expenditure on [food and drink] in the UAE is estimated to increase by 6.9% year-on-year (Y0Y), reaching $37 billion in 2020 from $34.6 billion in 2019.

“The KSA is likely to witness 5.4% YoY growth, which translates to $50.6 billion over the same timeframe, totalling over $80 billion for both markets,” announced the company.

“There is a growing awareness of organic food and increasing adoption of different cuisines due to Dubai’s sizeable expatriate population”

For Frost & Sullivan, food consumption habits and preferences are steering future growth potential in the market.

“Focusing on alternatives, such as organic, whole-wheat, and gluten-free products) and fortified foods, the majority of [food and drink] market leaders are achieving higher margins and revenues through innovation and constantly creating variety,” explained Roy.

For Roy, increasing awareness and attempts by governments to curb the intake of unhealthy food items “will push the demand for organic and balanced foods”.

The Frost & Sullivan analysis outlined what vendors should do to take advantage of the food and drink market in the KSA and UAE.

  • Demand for packaged food is surging at a rapid pace with the changing lifestyles in both countries.
  • There is a growing awareness of organic food and increasing adoption of different cuisines due to Dubai’s sizeable expatriate population.
  • A shift toward domestic production will help achieve food sufficiency and security per Saudi Vision 2030 and UAE National Food Security Strategy 2051.
  • The agriculture segment will adopt the Internet of Things (IoT) for food processing and traceability.
  • Meat processing, dairy, and confectionery segments are becoming increasingly attractive to foreign investors.
  • Increased social media participation from the younger population and financial independence will drive consumer preferences toward premium products, offering a unique consumption experience.

The 2020 Outlook of the KSA and UAE F&B Market is the latest addition to Frost & Sullivan’s Chemicals, Materials & Foods research and analyses available through the Frost & Sullivan Leadership Council.