Food to the United Arab Emirates

(Last updated: 6 Jun 2008)

Trends and opportunities

The market

Due to limited agriculture and industrial sectors, the United Arab Emirates (UAE) imports over 80 per cent of its food products. A high percentage of imported products (approximately 50 per cent) are then re-exported to Gulf Cooperative Council (GCC) countries, former Soviet states, the Indian subcontinent and Eastern Africa. The rapidly growing population and affluence of the UAE has spiralled the demand for high quality and specialised foods, thus creating opportunities for Australian suppliers in a wide range of food and beverage areas.

There are well-established trade and distribution channels between countries and Dubai, with UAE being the main trading hub for the region. In 2007, Australia exported about A$259 million worth of food products to the UAE including A$66 million of non-bovine meat, fruits, vegetables, dairy, wheat and barley, supermarket goods, and alcoholic beverages.
 

Due to the large expatriate population, a diverse range of food is available. In recent years, there has been a shift in food habits from traditional to Western-style convenience foods.

Recent forecasts indicate retail spending in the region of US$35 billion. The retail sector in the UAE continues to grow and develop at a rapid rate, a process that began in earnest nearly 10 years ago. Annually, many new state-of-the-art stores are added to the country’s retail map, creating continuous competition among the major retailers. In the period 1998-2004, retail outlets in the UAE grew by 47 per cent. Store sales by independent retailers account for 21 per cent, small shops/convenience stores 28 per cent and wholesalers around one per cent. It is estimated that 50 per cent of retail sales takes place within hypermarkets, superstores and supermarkets. Retail chains such as Carrefour, Spinneys and Lulu dominate the big format supermarket trade with 50 per cent market share.

UAE grocery retailing is growing at 5-10 per cent per annum. Foods sold in retail outlets consist of 75-80 per cent imported consumer-ready products, and 20-25 per cent locally processed foods. With the exception of fresh tomatoes used in the production of tomato paste and ketchup and a small quantity of fresh vegetables used in the production of frozen vegetables, almost every ingredient used in locally produced food is imported.

Local date processing is a rapidly expanding industry. Certain categories of snack food, juices and some confectionery items are locally produced.

Almost over 80 per cent of the food items are imported. Only 15 per cent are locally produced consisting mainly of:

• dairy products
• poultry and eggs
• seafood
• snack foods
• fresh tomatoes
• some vegetables
• a limited number of supermarket items

The UAE Government has a keen interest in fostering the development of the food processing industry having invested some US$1.4 billion since 1994 to develop a value-added food-manufacturing sector to target local and re-export markets. The result is that there are around 150 food processing plants in the country representing a large chunk of the region’s food manufacturing capability. Major food processing plants include vegetable oils, soft drinks and juices, snack foods, pasta, confectionary and dairy products.

Opportunities

For Australian exporters trade opportunities in the UAE exist in most food categories. However, the market is highly competitive given the UAE’s open trade policies. In some instances, opportunities for consolidators exist as import requirements are for mixed consignments because of small consumption levels.

The food service sector is also a particular growth area given the significant expansion of the tourism sector and the large number of new hotels and resorts being opened in the UAE.

The Government of Dubai has been implementing an ambitious plan including the construction of a number of luxury hotels, resorts, restaurants and furnished apartments.

Currently, Dubai has approximately 305 hotels (ranging from one to five stars), with 38,300 beds and 111 hotel apartment buildings with 8618 apartments. By 2010, an additional 15,400 serviced apartment rooms are due to enter the market. Nakheel, the developer of the Palm and Waterfront projects, will add some 200 hotels and resorts in Dubai over the coming years.

Dubai is set to add 45,000 rooms by 2012, while Abu Dhabi will add 10,000 rooms. Elsewhere in UAE, Abu Dhabi has 25 new hotels and Fujairah has confirmed six new developments of four to five stars hotels by 2010.

Competitive environment

Food suppliers from all over the world vigorously compete for market share. European Union, US and Asian products pose the greatest competition to Australian products as lower freight rates work in favour of these suppliers. It is acknowledged that Australia can compete on quality but higher freight costs can add to the price making products less competitive.

The major supermarket chains import some of their products direct from overseas suppliers. Most items are sourced locally from exclusive agents. The major sources of supply are from the Asian subcontinent and European markets that enjoy comparatively low freight rates.

The US dominates the high quality snack market enjoying a 15 per cent market share of an estimated $30 million a year export business in 1997. European companies, under license from American manufacturers, dominate the cereals market.

Australia is one of the major supplier of beef and lamb with strong competition from US, Holland and the India subcontinent. France, Australia, the UK and Holland dominate the market for cheese.

There are significant imports of juices and non-alcoholic beverages despite the availability of locally manufactured product.

The US leads the market for almonds but other nuts are imported from India and Iran.

Tariffs, regulations and customs

The UAE and other members of the GCC (Bahrain, Kuwait, Oman, Qatar and Saudi Arabia) are attempting to put together uniform laws relating to labelling, shelf life and food safety for the region.

However, there still exist differences in regulations where members fail to reach agreement so each GCC country has its own specific regulations.

The UAE regulates that food and beverage items imported into the country are subject to a five per cent import duty (excluding alcoholic beverages).

Certain products are exempted from this duty. For further details please contact Austrade.

No alcohol can be used as an ingredient or additive. Import of pork and pork products are permitted but are very strictly regulated.

No food labels can have pictures or recipes listing pork or alcohol. Alcoholic beverages are available in the UAE but their import is strictly restricted to licensed importers who source wine and spirits from around the world including a growing number of brands from Australia.

A health certificate attesting that the product is fit for human consumption, issued by the Australia Arab Chamber of Commerce and the UAE Embassy in Canberra, must accompany all imported food items.

Industry standards

Labelling is one of the most important issues for food exporters and you must be sure to include production and expiry dates, which needs to be printed on the original package or label. Arabic labelling is mandatory and can be printed on sticker.

The origins of all animal fats must also be stated.

Labels for imported goods need to have the following as standard, but please note that these are subject to change. You should always check for the latest regulations with the buyer when you are planning to export products to the UAE:

The following list comprises of mandatory labelling requirements on food pre-packages:

• Specific name of the food
• Ingredients in descending order of proportion
• Additives using their ‘E’ numbers (group names are also accepted)
• The origin of all animal fats
• Net contents in metric units
• Production and expiry date embossed on the package
• Country of origin
• Manufacturers' name and address
• Lot identification
• Special storage and preparation instructions, if any
• The expiry date must be printed in the following order depending on the shelf life: day, month and year for products having a shelf life of six months or less; or month and year for products with a shelf life more than six months. Production and expiration dates must be clearly printed, embossed or engraved; and shall be difficult to erase. It is also prohibited to write such dates manually or indicate them on a sticker (even on the sticker used for Arabic translation). Double dates are not allowed (such as indicating more than one production or expiration dates).

With few exceptions, all food items are required to have at least half of their shelf life remaining at the time of import. Frozen meat and poultry products must be imported within four months of their date of production irrespective of their shelf life.

A halal certificate issued by a UAE approved Islamic centre in Australia is mandatory for exporting any meat, poultry products or products containing gelatine. This documentation may also require attestation by the Australia Arab Chamber of Commerce and UAE Embassy.

All institutional size containers or products shipped in bulk also have the same labelling requirements.

Marketing your products and services

Distribution channels

Import and land distribution of food products is carried out by the private sector.

Government intervention is limited to health regulations and labelling requirements. Many importers in Oman, Qatar, Bahrain and Kuwait buy food items via the UAE, since individual orders from these countries tend to be less than the minimum required by suppliers. Thus, container-sized loads are shipped to the UAE and broken down into smaller quantities for transhipment to these countries.

Large importers are often integrated with logistics and distribution companies, who supply to wholesalers and retailers. Some of the large importers and distributors run their own retail outlets as well. The UAE distribution industry is very advanced, with sophisticated warehousing (cold chains) and inventory systems. The smaller organisations that do not own their own warehouses still have access through rented facilities.

Transport

Food items enter the UAE primarily via seaports with free trade zones situated in all the Emirates. The Jebel Ali port in Dubai is the world's largest man-made port, highly regarded for its expertise and precision in cargo handling. There are also cargo handling facilities attached to the international airport, called cargo 'villages'. Dubai Cargo Village handles more air cargo than any other airport in the region, much of it coming into Dubai by sea and going out by air mainly to Europe.

Links and industry contacts

Food–related resources

Dubai Municipality (Food Control Section) – www.dm.gov.ae 
Public Health Department – Dubai Municipality
PO Box 67, Dubai, UAE
Tel: +971 (4) 206 4009
Fax: +971 (4) 2221 513
Email: info@dm.gov.ae

Government, business and trade resources for United Arab Emirates

Arabia.com – www.arabia.com
Dubai Cargo Village – www.dubaicargovillage.com
Gulf Business Magazine Online Edition – www.gulfbusiness.com
Dubai Ports Authority (Jebel Ali) – www.dpa.co.ae 
UAE Interact – www.uaeinteract.com Database of UAE news archives, and information on UAE for business and general interest

Australian Business Council (formerly known as Australian Business in the Gulf Group) –  www.abiguae.com
PO Box 20183, Dubai, UAE
Tel: +971 (4) 367 2437
Fax: +971 (4) 367 8640
Email: events@abc-dxb.com

Abu Dhabi Chamber of Commerce and Industry – www.abudhabichamber.ae
PO Box 662, Abu Dhabi, UAE
Tel: +971 (2) 617 7503
Fax: +971 (2) 634 4759
Email: services@adcci.gov.ae

Dubai Chamber of Commerce and Industry – www.dcci.ae
PO Box 1457, Dubai, UAE
Tel: +971 (4) 228 0000
Fax: +971 (4) 221 1646
Email: dcciinfo@dcci.org

Sharjah Chamber of Commerce and Industry – www.sharjah.gov.ae 
PO Box 580, Sharjah, UAE
Tel: +971 (6) 568 8888
Fax: +971 (6) 568 1119
Email: scci@sharjah.gov.ae

Victorian Government Business Office
PO Box 58004, Dubai, UAE
Tel: +971 (4) 321 2600
Fax: +971 (4) 321 2700
Email: dubai@iird.vic.gov.au

Government of South Australia Commercial Representative Office
PO Box 58048, Dubai, UAE
Tel: +971 (4) 343 2884
Fax: +971 (4) 343 2885
Email: sagovtme@emirates.net.ae

Western Australian Trade Office
PO Box 58007, Dubai, UAE
Tel: +971 (4) 343 3226
Fax: +971 (4) 343 3238
Email: info@wato.ae 

Trade Queensland
Office 801, Level 8
Lulu Building, Salam Street
Abu Dhabi, UAE
Tel +971 2 696 8700
Fax +971 2 678 2824
Email: Susan.rae@trade.qld.gov.au

Media

Gulf Business Magazine Online Edition – www.gulfbusiness.com
UAE Interact – www.uaeinteract.com 

Contact details

The Australian Trade Commission (Austrade) is the Australian Government’s trade and investment development agency, operating as a statutory agency within the Foreign Affairs and Trade portfolio.

Austrade assists Australian businesses contribute to national prosperity by succeeding in trade and investment, internationally, and promoting and supporting productive foreign investment into Australia.

Austrade:

• Delivers services that assist Australian businesses initiate, sustain and grow trade and outward investment.
• Promotes Australia as an inward investment destination and, with the States and Territories, supports the inflow of productive foreign direct investment.
• Administers the Export Market Development Grants scheme.
• Undertakes initiatives designed to improve community awareness of, and commitment to, international trade and investment.
• Provides advice to the Australian Government on its trade and investment development activities.
• Delivers consular, passport and other government services in designated overseas locations.

A list of Austrade offices (in alphabetical order of country) is available.

More information

For further information please contact Austrade on 13 28 78 or email info@austrade.gov.au