“Halal” does not refer only to a food category. The Arabic term refers to any act or object that is considered permissible under the standards of Islam, and the apparent religious product branding has now evolved into a very lucrative global market.
The world market for Halal food products is estimated to be around $630 billion and is still rapidly growing at approximately 20% annually.
The tremendous growth has been seen over the past few years. At the start of the new millennium there was already an increase in the Islamic population, which primarily caused the growth on the demand for Islam-acceptable food. (Muslims reportedly comprise more than 20% of the world population.)
In 2004, the Halal food market was already estimated to be worth around $580 billion.
The increase in the purchasing power of Muslims, especially in industrialized nations, also contributed to the global rise of this market. The Muslim community in Europe, in particular, has better purchasing power relative to Asian and African Islamic states. This is reflected in their food preference which demonstrate a demand for western food qualified for their standards.
Prior to the demand boost, the source of Halal food products were primarily the Muslim countries.
However, the population growth has offset the growth of production.
This resulted in an opportunity which non-Muslim countries gladly captured. Currently, it is estimated that 85% of the Halal food is produced from non-Muslim countries. Australia and New Zealand are a case in point: they are known to be one of leading suppliers of Halal meat since 2003.
By the end of the year, the anticipated value of the Halal food industry is pegged at over $640 billion.
Furthermore, the rise of Halal market is considered by the Asian Leadership and Strategy Institute as one of the latest trends and opportunities together with the Internet, social networking, and viral marketing.
Demand is greater than the Muslim population
Halal food is the standard food for Muslims, and it can be a choice for non-Muslims as well. The enormous market size of the Halal food industry may also be, in fact, due to the patronage of non-Muslims.
Halal food products are perceived to be hygienic and healthy. In marketing, qualifying to the Halal standards can now be considered as a strategy to widen the target market.
Without the Halal certification, food businesses can only target the usual consumers, while obtaining the certification will add at least two market segments: the Muslim consumers and the health-conscious clients. According to the Department of Science and Technology (DoST), there are seven billion non-Muslim consumers who prefer healthy and wholesome food which is similar to Halal food products.
This operation and marketing strategy is already applied by some fast-food chains abroad. Kentucky Fried Chicken (KFC) decided to make eight of its branches in London serve only Halal menu. The fast-food chain promised to maintain the same “finger-lickin’ good chicken” while tapping a wider range of customers through the Halal-approved strategy. Prior to KFC, Domino’s Pizza has already introduced its Halal menu in its Birmingham branch. This is very risky move for the pizza chain because some of the famous pizza favorites include bacon and sausage. Similar to KFC, Domino’s Pizza claimed the decision to be a measure to improve the business considering the high population of Muslims.
In the Philippine market, where a majority are Roman Catholic, Halal-certified food products are very visible as well. Supermarkets and grocery stores in the country also carry an increasing number of Halal-certified products such as toothpaste, instant coffee, canned goods, catsup, and instant noodles. Although a majority of these products are manufactured by international brands, there are also some Halal-approved local brands (such as Swift of the RFM Corp.)
This industry has also proven its profitability. During the years 2004 to 2005 alone, Halal product distributor Al Islami Foods in the Middle East experienced a staggering 25% sales growth rate registering $41 million.
Jobs for Filipino Muslims, export boost for the Philippines
As one of the countries with a considerable Muslim population (given that the country is home to 18-20 million Muslims, with the majority in Mindanao), the Philippines is in a favorable position to grab a hold of the worldwide Halal industry.
On the other hand, the country has not fully exploited its potential.
As early as 2001 the country has been trying to develop the domestic production of Halal products by creating a certification and regulatory board and by later luring foreign countries, particularly those in the Middle East and Southeast Asia.
Until today, such negotiations are still pursued by the government.
One in particular is the dialogue with Kuwait and Brunei. The negotiation involves the Halal Economic Zone and Halal poultry farm both in Mindanao, a proposal that reportedly sums Php3.04 billion.
This particular thrust can engage a total of 56,000 Filipino Muslims in new jobs, farming, and entrepreneurship. It can also increase the country’s exports by as much as $200 million annually. This presents good opportunities for the export industry, considering its decline due to the global economic turmoil. Furthermore, the global demand for Halal products remains stable and increasing in the face of the economic meltdown.
Mindanao possesses great advantages to be a competitive Halal product manufacturer due to its natural endowments and environment. The region is located outside the typhoon infested area of the country, making it suitable for agricultural activities that can provide the raw materials for production.
Spillover effects to other sectors can also be realized with the development of the Halal industry in the region; for instance, domestic tourism in Mindanao can be improved with a development of food industry suitable to their culture and flavor.
Conclusion
The increasing world Muslim population is posting many opportunities. Globalization and trade have the main contributions to the exploitation of these opportunities. With the integration of economies, there is no need to self-produce everything as there are lesser barriers that prevent two or more countries from trading.
In the case of the Halal products, Muslim countries need not produce their entire food requirement. Countries that can produce at relatively lower costs can freely trade with countries with the demand for Halal products. In this arrangement, both countries are mutually benefiting from each other.
For the Philippines to grab a piece of the cake, combination of political will, private sector involvement, and trade openness in needed. This industry can revive the export sector of the country. If the country is able to capture the domestic market and penetrate the international marketplace, it can boost not only the economy of the country but the quality of life of the Filipino Muslims in the Mindanao region.
The world market for Halal food products is estimated to be around $630 billion and is still rapidly growing at approximately 20% annually.
The tremendous growth has been seen over the past few years. At the start of the new millennium there was already an increase in the Islamic population, which primarily caused the growth on the demand for Islam-acceptable food. (Muslims reportedly comprise more than 20% of the world population.)
In 2004, the Halal food market was already estimated to be worth around $580 billion.
The increase in the purchasing power of Muslims, especially in industrialized nations, also contributed to the global rise of this market. The Muslim community in Europe, in particular, has better purchasing power relative to Asian and African Islamic states. This is reflected in their food preference which demonstrate a demand for western food qualified for their standards.
Prior to the demand boost, the source of Halal food products were primarily the Muslim countries.
However, the population growth has offset the growth of production.
This resulted in an opportunity which non-Muslim countries gladly captured. Currently, it is estimated that 85% of the Halal food is produced from non-Muslim countries. Australia and New Zealand are a case in point: they are known to be one of leading suppliers of Halal meat since 2003.
By the end of the year, the anticipated value of the Halal food industry is pegged at over $640 billion.
Furthermore, the rise of Halal market is considered by the Asian Leadership and Strategy Institute as one of the latest trends and opportunities together with the Internet, social networking, and viral marketing.
Demand is greater than the Muslim population
Halal food is the standard food for Muslims, and it can be a choice for non-Muslims as well. The enormous market size of the Halal food industry may also be, in fact, due to the patronage of non-Muslims.
Halal food products are perceived to be hygienic and healthy. In marketing, qualifying to the Halal standards can now be considered as a strategy to widen the target market.
Without the Halal certification, food businesses can only target the usual consumers, while obtaining the certification will add at least two market segments: the Muslim consumers and the health-conscious clients. According to the Department of Science and Technology (DoST), there are seven billion non-Muslim consumers who prefer healthy and wholesome food which is similar to Halal food products.
This operation and marketing strategy is already applied by some fast-food chains abroad. Kentucky Fried Chicken (KFC) decided to make eight of its branches in London serve only Halal menu. The fast-food chain promised to maintain the same “finger-lickin’ good chicken” while tapping a wider range of customers through the Halal-approved strategy. Prior to KFC, Domino’s Pizza has already introduced its Halal menu in its Birmingham branch. This is very risky move for the pizza chain because some of the famous pizza favorites include bacon and sausage. Similar to KFC, Domino’s Pizza claimed the decision to be a measure to improve the business considering the high population of Muslims.
In the Philippine market, where a majority are Roman Catholic, Halal-certified food products are very visible as well. Supermarkets and grocery stores in the country also carry an increasing number of Halal-certified products such as toothpaste, instant coffee, canned goods, catsup, and instant noodles. Although a majority of these products are manufactured by international brands, there are also some Halal-approved local brands (such as Swift of the RFM Corp.)
This industry has also proven its profitability. During the years 2004 to 2005 alone, Halal product distributor Al Islami Foods in the Middle East experienced a staggering 25% sales growth rate registering $41 million.
Jobs for Filipino Muslims, export boost for the Philippines
As one of the countries with a considerable Muslim population (given that the country is home to 18-20 million Muslims, with the majority in Mindanao), the Philippines is in a favorable position to grab a hold of the worldwide Halal industry.
On the other hand, the country has not fully exploited its potential.
As early as 2001 the country has been trying to develop the domestic production of Halal products by creating a certification and regulatory board and by later luring foreign countries, particularly those in the Middle East and Southeast Asia.
Until today, such negotiations are still pursued by the government.
One in particular is the dialogue with Kuwait and Brunei. The negotiation involves the Halal Economic Zone and Halal poultry farm both in Mindanao, a proposal that reportedly sums Php3.04 billion.
This particular thrust can engage a total of 56,000 Filipino Muslims in new jobs, farming, and entrepreneurship. It can also increase the country’s exports by as much as $200 million annually. This presents good opportunities for the export industry, considering its decline due to the global economic turmoil. Furthermore, the global demand for Halal products remains stable and increasing in the face of the economic meltdown.
Mindanao possesses great advantages to be a competitive Halal product manufacturer due to its natural endowments and environment. The region is located outside the typhoon infested area of the country, making it suitable for agricultural activities that can provide the raw materials for production.
Spillover effects to other sectors can also be realized with the development of the Halal industry in the region; for instance, domestic tourism in Mindanao can be improved with a development of food industry suitable to their culture and flavor.
Conclusion
The increasing world Muslim population is posting many opportunities. Globalization and trade have the main contributions to the exploitation of these opportunities. With the integration of economies, there is no need to self-produce everything as there are lesser barriers that prevent two or more countries from trading.
In the case of the Halal products, Muslim countries need not produce their entire food requirement. Countries that can produce at relatively lower costs can freely trade with countries with the demand for Halal products. In this arrangement, both countries are mutually benefiting from each other.
For the Philippines to grab a piece of the cake, combination of political will, private sector involvement, and trade openness in needed. This industry can revive the export sector of the country. If the country is able to capture the domestic market and penetrate the international marketplace, it can boost not only the economy of the country but the quality of life of the Filipino Muslims in the Mindanao region.
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