Content
1. Global Halal Market
2. How Big Is the Global Muslim Market?
3. Development of Regional Halal Market
4. The Halal Product Certification

Global Halal Market
The global Halal market value for trade in Halal foods is estimated at US$547 billion a year. This large market has created interest from food producing countries worldwide. In this respect, Malaysia has the edge in being recognized internationally as a progressive Muslim country, where it has the potential of becoming a major producer of Halal food products [[Malaysia 3rd Industrial Master Plan]]. To realize this potential, apart from the commitment and support by the Government, the food-based Halal industries are shown to be focusing their efforts in producing and exporting Halal food products.

The increasing awareness of Muslim consumers on their religious obligations is creating greater demand for halal food and other consumer goods. There are approximately 2 billion Muslims out of the 6.5 billion world population. Majority of the nations are in OIC member countries. The global Halal food market is on the threshold of major developments that hold the promise of rapid and sustained growth. With the Halal food market currently accounting for as much as 12% of global trade in agri-food products, major growth will generate growth opportunities throughout the agri-food industry. Many reports on the Halal market focus on meat, but products sold under the Halal label cover virtually every agri-food product plus non-food products such as cosmetics. For instance, a very wide range of products that labeling Halal in Malaysia is such as sauces, bottled water, tea, coffee and fruit drinks.

The trade in halal food is enormous with an estimated annual halal food value of US$347 billion (RM 1,317 billion) globally. It is a lucrative market and huge opportunities for halal food business - domestic and international trade. Many companies are looking at halal concept as a new tool for marketing. Some facts of market trend in abroad in the past few years did showed that the development of global Halal food market is up-rising. For example, the Australian Halal meat sales rose by 70% between 1997 and 2002. Annual Australian Halal exports in 2003 were valued at A$ 3.7 billion for meat and A$ 1 billion for dairy produce. The Australian Government has committed A$ 100 million over 5 years to promote their Halal food export business. Besides, the New Zealand Lamb exports account for 40% of the world market and 95% of all New Zealand lamb exports are now Halal while non-Halal production is being phased out.

In addition, the European Supermarket giants Carrefour and Auchan are now aggressively pursuing the Halal food retailing, while in the meantime the Port of Rotterdam is currently creating a "Halal DistriPark" to serve 30 million Muslims in Europe. The availability of Halal food from fresh meat to value added/processed food is increasingly visible in many EU countries. From butcheries, small stores, supermarkets and hypermarkets are gradually sells Halal food products, although this typically started in the Muslim-majority areas. Besides, there were also butcheries and grocery stores for the Muslims in China.

Currently, the global Halal market has gained its attention from the trade merchant world. Many Halal Expos had been held around the world, for example in Malaysia, Singapore, Turkey, Dubai-UAE and Iran. E-commerce and online business portal had been proved to be one of the best e-business solutions to penetrate the emerging market. However, not much e-commerce portal either by government or private sector that focusing on the Halal market has being seen in the Halal trade market. Currently, the well known largest Halal business portal in the world which supported by the Malaysian government – DagangHalal.com is currently taking the mission of propagate Malaysia as the Global Halal Hub and integrating the manufacturers, importers, exporters, distributors and Halal service providers into the global Halal industry.

The dynamics driving forces of the global Halal food market includes:
How Big Is the Global Muslim Market?
The world Muslim population is approaching 1.6 billion people. Muslims are expected to account for 30% of the world’s population by 2025.

There are around 1.3 billion Muslims in the world and 1.5 billion halal consumers, which means that one out of every four human beings consumes halal products. The difference of 0.2 billion between the halal consumers and Muslims is accounted for by non-Muslims living in Muslim-majority countries where most foods are halal, such as Indonesia and Bangladesh.

Presently, Southeast Asia and the Middle East are the two strong markets for halal products (Riaz, 1998). All major U.S. poultry processors export to these markets, whereas secondary suppliers provide beef. The primary sources of been in those markets are imports from Australia and New Zealand, whose governments are very supportive of halal programs (Chaudry, 1997). Marketing efforts to supply certified halal products throughout the world are gaining momentum.

Southeast Asia is home to more than 250 million halal consumers. Indonesia, Malaysia, and Singapore have had regulations to control the import of halal-certified products for some number of years. Recently, Thailand, the Philippines, and other countries have realized the value of halal-certified products and their governments are formulating regulations to promote both export and import of halal-certified products. For export to many of the Association of South East Asian Nations (ASEAN), even the simplest of vegetable products must be certified. In this region, even non-Muslim consumers perceive halal as a symbol of quality and wholesomeness.

Middle Eastern countries are net importers of processed foods both for the food service and retail markets. Saudi Arabia, United Arab Emirates, and other Middle Eastern countries have been importing food for decades. North Africa and other African countries also offer opportunities for export of processed food as their economies and political conditions improve.

South Asia, comprising India, Pakistan, Bangladesh, and Sri Lanka, is home to almost 1.3 billion people, of which over 400 million are Muslims. Although this region is an agricultural economy, these countries do import certain processed items, especially for food service.

In the late 1980s and early 1990s, the potential of the Southeast Asian and Middle Eastern markets for halal foods started to be realized, leading to an increase in the production and certification of halal foods. This has expanded into South Asia, the Mediterranean, Europe, and Central Asia. The benefits of trade for Western corporations with Muslim-majority countries are clear. Even Muslim minority countries such as Singapore and South Africa have shown that the halal food business is good business. Although the Muslim community forms only 16% of the 3.8 million population of Singapore, the halal food industry is big business in this cosmopolitan city. McDonald’s, A & W, Kentucky Fried Chicken, and Taco Bell are some international brands that have gone 100% halal in Singapore.

The opportunities available to a corporation able to supply halal products are continuously growing. Muslims are starting to blend the best of Western attitudes with their generally Eastern cultures. Additionally, the large addition of Westerners to the faith of Islam is resulting in some changes in the behavior of the Muslim community. Whereas in the past Muslims simply avoided foods that did not meet the dietary standard of halal, today Muslims are making their presence felt socially and politically. Muslims are now requesting food products that meet their dietary needs. They are offering services and cooperating with producers with the foresight and wisdom to cater to the Muslim consumer.

Key Halal Muslim Markets - 652 million

Algeria Iran Lebanon Qatar Turkey
Bahrain Iraq Malaysia Saudi Arabia United Arab Emirates
Egypt Jordan Morocco Syria Yemen
Indonesia Kuwait Oman Tunisia

Purchasing Power of the Muslim Countries

  Muslim Population (Million, 2005) Per capita food expenditure (p/a US$) Halal Food Market (Millions US$)
Africa 461.77 250 115,443
West Asia 195 570 111,150
South Central Asia 584.8 300 175,440
Southeast Asia 266.37 350 93,230
China 39.1 175 5,865
Europe (incl Russia) 51.19 1,250 63,988
North America 8.26 1,750 14,455
South America 1.64 500 820
Oceania 0.35 1,500 525
Total 1,565   580,915

Source: http://www.islamicpopulation.com, Euromonitor.

World Muslim Population (Millions)

Continent World Population in 2006 Muslim Population in 2006 Muslim Percentage
Africa 923.2 442.88 47.97
West Asia 3970.5 1060.65 26.71
Europe 731.7 50.7 6.93
North America 331.7 7.13 2.15
South America 566.05 3.08 0.54
Oceania 33.54 0.60 1.79
Total 6313.78 1565.28 24.79

Development of Regional Halal Market

United States
Muslims in North America have increased in number since World War I and even faster after World War II. As of 1992, their numbers are estimated at 6 to 8 million and they are spread all over the continent in cities both large and small (Sakr, 1993). The majority of Muslims are immigrants and their descendants. Americans and Canadians who have accepted Islam are about 25 to 30% of the current Muslim population. In the U.S., the top ten major halal food markets are (1) New York City, New Jersey, and Long Island metropolitan areas; (2) Los Angeles; (3) Chicago; (4) Detroit; (5) Houston; (6) Dallas/Forth Worth; (7) South Florida; (8) San Francisco; (9) Atlanta; and (10) Washington, D.C. The US market for Halal products is estimated at US$12 billion annually and domestic sales are growing. Estimates on sales growth are difficult to obtain, but US sales of Halal food have increased by more than 70% since 1995. US companies are significant exporters of Halal products.

According to one estimate, the buying power for food of Muslim consumers in North America was worth $12 billion in 1999. It is estimated that amount of spending by Muslims on food will exceed $15 billion in 2003, taking into consideration the growth in Muslim population through birth and recent immigration. Sales of halal foods are gaining popularity at grocery stores and restaurants. According to one estimate, sales of halal products will continue to climb as the number of U.S. Muslims grows. A Kansas company launched a line of halal frozen pizzas. An Ontario company has an extensive line of frozen halal meat, poultry, and other products. Most meat companies had been making halal food products only for export; now small- to mid-size companies are producing halal products exclusively for the domestic U.S. and Canadian markets. For the first time in the history of the U.S. military, certified halal meals are available to Muslim soldiers.

In the U.S., there are a number of areas where providers of halal products are becoming active. Among these are public and private schools, prison systems, the vending industry, and convenience foods such as frozen dinners and airline meals. The number of Muslim students in public schools is increasing annually. These children generally bring their own lunches to school or skip lunch. When vendor contracts are awarded, those who can supply halal meals to the school system will have an advantage over those who cannot supply these special meals.

As with everyone else, Muslims have a very busy life style. Increasingly, daily activities at work and home do not allow them to prepare meals at home. Muslims, like any other segment of population, are involved with their jobs and other away from-home activities and demand on their time has increased. Availability of prepared convenience foods has become more and more important. Consequently, availability of halal prepared foods will serve a very useful purpose.

Vending is another area where a tremendous opportunity exists for halal food. Items such as sandwiches, hot meals (such as beef stew and soups), cookies, cakes and rolls, ice cream, and candy can be a very practical means of making halal foods available in places where the concentration of Muslims might not justify other types of foods. Places such as hospitals, where many Muslim doctors practice and where Muslim visitors come to check on friends, will benefit from this service. Halal food vending can also be considered for cafeterias in schools, colleges, and places of business with lower concentrations of Muslims.

There are over 8500 grocery items on the typical shelves of North American and European supermarkets, and many more are being added daily. Very few food items in grocery stores have halal markings. Muslims are making their decisions based on the ingredient information on the labels that might indicate whether that particular food item is lawful for Muslim consumption. It will be helpful for Muslim consumers to have halal markings on the label.

Europe
Europe is seen as an important market for Halal products on the basis of higher purchase power rather than population size. Furthermore, non-Muslims’ willingness to purchase Halal food adds to the attractiveness of the European market. In particular, one study has indicated that Dutch consumers in general are willing to purchase Halal products on the basis of the belief that such products are safe. Figures vary considerably with industry estimates for the global Halal food market ranging from €110 billion to €560 billion. Estimates on the size of the European Halal food market also vary, but in 2006 the USDA Foreign Agricultural Service suggested a conservative figure of €15 billion.

Europe is home to over 50 million Muslims and Europe’s Muslim population has grown by more than 140% in the last decade. Muslims across Europe have far higher consumer spending power than those in the Middle East and North Africa with 2nd and 3rd generation European Muslims seeking out convenience and looking for products such as Halal pizzas, lasagne and hot dogs. The port of Rotterdam is attempting to become recognized as the key Halal entry point for the European Market. The port intends to dedicate one warehouse solely to Halal products and towards ensuring that Halal products do not come into contact with non-Halal products. The Halal supply chain in the Netherlands for products from Malaysia which is the collaboration between Port Klang and the Port of Rotterdam is expected to be established in six months. It is told that in about six months, the Halal supply chain from Rotterdam to north-west Europe will be established, which connects the manufacturers in Malaysia and the shops in north-west Europe.

France has the largest population of Muslims in Europe. It is reported that there are more than 4 million Muslims in France. France is the largest market for Halal products among non- Muslim countries. The value of the French market for Halal products has been estimated at over US$13 billion. Younger Muslims, under the age of 30, account for about 80% of France’s Halal purchases. Germany is also home to a considerable number of Muslims. EuroIslam.info estimates 3.5 million Germans are Muslim.

It is worth noting that, while the majority of Muslims in the UK come from Pakistan and Bangladesh, other European Muslims tend to come from different parts of the world. The majority of Muslims in France, Spain, Italy and Scandinavia tend to originate from North Africa, while the Muslim population in Germany tends to hail from Turkey. The implications of these differences should be seriously considered in planning any Halal exports to mainland Europe. In some European countries, the size of Muslim households is declining and leading to a reduction in the importance of formal family meals. In addition, more homes are being equipped with extra freezing capacity and microwave ovens. Both trends are increasing the importance of convenience foods.

Middle East
Middle East countries, especially members of the Cooperation Council for the Arab States of the Gulf (GCC), have higher incomes and consequently higher per capita rates of consumption. In addition, the region must import 80% of its food requirements. Saudi Arabia and the United Arab Emirates (UAE) are seen as the most important import markets in the region. Currently Brazil is the largest exporter to the two countries followed by the EU and the US. Saudi Arabian companies involved in the Halal industry include Al-Radwa Farms, Al- Watania, Supreme Foods, Nash Meat and Sunbullah. UAE companies involved in the Halal industry include Al-Islami Foods, Al-Babeer, Al-Areesh, Arctic Gold, Royal Meat and Emirates Meat.

Turkey is a growing Halal market and as a potential supplier of Halal products, particularly to EU counties with large Muslim populations such France and Germany. Egypt was recently seen as the most important market for Halal food in North Africa. However, it has been noted that the "complex regulatory system" in Egypt has led a number of potential suppliers to serve the market through investment rather than exports.

Asia
Asia has the largest Muslim population of any given region, but the population has modest per capita incomes, and hence lower total food consumption than other areas. For example, high population countries like India and Pakistan have relatively low consumer incomes and consequently exhibit lower per capita protein consumption. Despite lower income levels, this region has been at the forefront of capitalizing on the growing Halal market.

Malaysia, Thailand, Singapore, the Philippines, Brunei, China and India have all taken steps to tap into the global Halal market. Malaysia, in particular, has designs on becoming an international Halal hub and its government has taken a number of measures to support that objective including the establishment of the Halal Development Corporation. The Singapore food industry has also taken a number of steps toward becoming a Halal hub, including an advertising campaign in the Middle East. Thailand has moved to become a recognized Halal centre of excellence in science and testing.

Brunei is currently co-operating with Australian companies in order to combine its role in the Muslim world with Australia’s track record in safe, high quality food production. The Chinese Halal industry is growing and is expected to expand its role in the global market. At the moment, the key advantage of the Chinese Halal industry is access to cheap labor. China recently signed a Memorandum of Understanding with the European Commission (EC) and already has several EC-approved companies ready to export Halal products to European markets. Indian exporters are attempting to gain recognition through the achievement of HACCP, ISO and Halal certification. Leading Indian exporters include Allanasons, Hind Agro, Al-Kabeer, Arabian Exports, M.K. Overseas and Amroon Foods.

The Halal Product Certification

Halal product certification is the prerequisite for entering the global Halal market. A halal certificate is a document issued by an Islamic organization certifying that the products listed on it meet Islamic dietary guidelines, as defined by that certifying agency. There were 3 types of Halal certificates:
  1. Registration of a site certificate: This type of certificate signifies that a plant, production facility, food establishment, slaughterhouse, abattoir, or any establishment handling food has been inspected and approved to produce, distribute, or market halal food. This does not mean that all food products made or handled at such a facility are halal certified. A site certificate should not be used as a Halal product certificate.

  2. Halal certificate for a specific product with specific duration: This type of certificate signifies that the listed product or products meet the halal guidelines formulated by the certifying organization. Such a certificate may be issued for a certain time period or for a specified quantity of the product destined for a particular distributor or importer. If the certificate is for a specific quantity, it may be called a batch certificate or a shipment certificate. Meat and poultry products, for which each batch or consignment has to be certified, generally receive a batch certificate.

  3. Yearly certification: This may be automatically renewed contingent on passing the annual inspection, through halal compliance and payment of the certification fee.


However, there were some surveys showing that entrepreneurs facing certification challenges when entering the global Halal market: Internationally, Halal certification is currently carried out by a large number of certification bodies throughout the world with multiple, overlapping and inconsistent requirements. Information shared at the recent World Halal Forum 2007 in Malaysia described problems in the certification of Halal products as the key issue in the development of the world market for Halal foods. There are an ever growing number of certification bodies, differing standards and open challenges to competing standards in the name of business gains, not quality assurance. Discussions during the World Halal Forum presented a wide variety of views on certification, especially regarding certification of slaughter practices and facilities.




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