The GCC food market is expected to witness a moderate growth rate of 2.3% during the forecast period of 2022-2028. The regional growth is backed by an increase in population, post-pandemic recoveries in tourism, higher per capita income, and overall economic growth. The increasing population primarily made up of young, working-class professionals is one of the major growth factors for the market. Moreover, the GCC governments have taken several steps to improve food production and food security whilst ensuring an ample supply among the population. Additionally, the growing proportion of the youth population is highly influenced by global consumer trends, thereby driving the demand for international food and foreign cuisines. However, the hotel and tourism industries have been hampered by travel restrictions, and also lower earnings of governments as a result of the drop in oil prices which have raised pressure on regional governments in terms of spending.
The increasing awareness about eating healthy is expected to expand the potential of the GCC Food Market
There is an evident shift toward the use of organic food rather than conventional Foods. Eating home-cooked food, preferring fresh produce over canned food products, and eating foods with high nutritional value are some of the major trends in the GCC food market. The popularity of large modern food retail chains and the entry of international food corporations continue to boost customers’ popularity for packaged and ready-to-cook meals. However, as the GCC region is heavily reliant on imports from other countries for food resources, GCC countries are exposed to challenges of food security. Moreover, this dependency can expose the GCC countries to global price fluctuations and cause inflationary pressure due to supply chain disruptions in the forthcoming years.
Furthermore, private labels are gradually gaining popularity amongst the GCC population and have emerged as a key strategy for large supermarket and hypermarket operators. With increased competition and consolidation in the retail space, private labels have become a new avenue for retailers to drive revenues and strengthen their position in a highly competitive market. One of the key drivers of the rise in demand for private labels has been the cost-competitiveness compared to branded products.
Saudi Arabia dominates the GCC food market
Saudi Arabia holds a major share in the GCC food market in 2021 and is expected to maintain its trend over the forecast period. The major reasons for this growth are the rise in the millennial working population and changing consumer lifestyles. An increase in per capita income coupled with the growing urbanization rate is likely to increase the propensity of consumers to spend on high-value food products, especially organic food items, which in turn will fuel the growth of the GCC food market. Moreover, Saudi Arabia is expanding its aquaculture sector to meet domestic as well as international demand. Additionally, private players have also invested heavily in the UAE’s aquaculture industry in recent years which is likely to provide a significant thrust to the regional market growth. UAE is also attracting emigrants to set up their businesses in the country and providing incentives for global talent, backed by several initiatives in the form of residency visas which will propel the food industry growth.
Market Structure and Competitive Landscape
The GCC food market is fragmented in nature and observes intense competition in terms of cost and quality of food products. Some of the prominent players that contribute significantly to the GCC Food market include Bahrain flour mills company, Al Jouf Agricultural Development Co. SJSc, Halwani Brothers Co. Ltd, Almarai Co, Agthia Group PJSC, Hasan & Habib Sons of Mahmood Co WLL, Paris Group, Ali Shahihani Group of Industries, Sadita Holding Co, Barakat Group, Dubai Refreshments PJSC, Foodco Holding PJSC, Mezzan Holding Co KSCP, National Agriculture Development Company, Oman Refreshments Company, Savola Group Co SJSC, and Trafco Group B.S.C among others. Product launches, mergers & acquisitions, joint ventures, partnerships and collaborations, and geographical expansion are key strategies adopted by the players in the GCC food market. These companies adopt numerous approaches to strengthen their market share and gain a competitive edge over other competitors in the market. Some of the key developments in the GCC Food market include,
- In October 2021, Savola Foods acquired 100% of Bayara Holding for US$ 260 million to expand into value-added food categories with propositions directed towards the younger population.
- In August 2020, Delivery Hero acquired 100% of Instashop, one of the largest online grocery platforms in the Middle East and North Africa.
- In April 2020, Kuwait’s Wafra International Investment Company invested US$ 100 million in Pure Harvest Farms, the largest ever commitment to an AgriTech firm in the Middle East.
Key Market Segmentation
RationalStat has segmented the GCC Food market on the basis of type, form, nature, distribution channel, nature, and country.
- By Type
- Fruits and Vegetables
- Dairy Products
- Others (Bakery & Confectionary etc.)
- By Nature
- By Distribution Channel
- Convenience Stores
- By Country
- Saudi Arabia
RationalStat has developed a state-of-the-art research methodology to crunch numbers and provide the best possible real-time insights to clients. We combine a varied range of industry experience, data analytics, and experts’ viewpoint to create a research methodology for market sizing and forecasting.
RationalStat combines a mix of secondary sources as well as primary research to assess the market size and develop a forecast. Key steps involved in accurately deriving the market numbers are:
- Defining the problem by understanding the type of market and data required by the client.
- Data gathering and collection through relevant paid databases, publicly available sources, company reports, annual reports, surveys, and interviews.
- Formulating a hypothesis to create market numbers, forecasts, influencing factors, and their relevance.
- Evaluating and analyzing the data by referring to data sources utilized and leveraged.
- Validating, interpreting, and finalizing the data by combining the details gathered from primary and secondary sources with the help of experienced analysts.
- Annual reports, company filings, investor presentations, product catalogs, and company documents
- Industry and market-related documents available in the public domain
- Paid database including Bloomberg, Factiva, S&P Capital IQ, FactSet, Refinitiv Eikon, ICIS, EUWID, and Thomson Reuters, among others
- Whitepapers, research papers, and industry blogs.
Why Buy this Report?
The report is intended for food producers and suppliers, food processors, government organizations, educational organizations, regulatory agencies, and market research firms, among others. The report provides an in-depth analysis of market size, consumption patterns, ongoing market trends and challenges, and future market opportunities. The report will serve as a source for a 360-degree analysis of the market thoroughly delivering insights to clients to find the right answers to their business questions.
Frequently Asked Questions (FAQs)
The GCC Food Market is expected to grow at a CAGR of 2.5% during the forecast period 2022-2028.
Saudi Arabia holds a prominent share in the GCC Food Market.
The demand for food in the GCC Food Market is estimated at around 46.8 million metric tons in 2021.
The GCC Food Market is primarily driven by the growing younger population and increased government spending.
Major companies operating in the GCC Food Market include, Bahrain flour mills company, Al Jouf Agricultural Development Co. SJSc, Halwani Brothers Co. Ltd, Almarai Co, Agthia Group PJSC, Hasan & Habib Sons of Mahmood Co WLL, Paris Group, Ali Shahihani Group of Industries, Sadita Holding Co, Barakat Group, Dubai Refreshments PJSC, Foodco Holding PJSC, Mezzan Holding Co KSCP, National Agriculture Development Company, Oman Refreshments Company, Savola Group Co SJSC, and Trafco Group B.S.C among others.