Halal

NZTE recommends companies stay up to date with this rapidly changing global market said to be worth US$2.3 trillion. Food products comprise 61 percent, pharmaceutical products 26 percent and cosmetics 11 percent.

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What is halal?

The concept of halal – defined by the Quran as 'allowed', 'permitted' or 'lawful' – has slowly become accepted as a consumer lifestyle choice encompassing not only religious practices and food, but also finance, non-food products and logistics.

The common understanding of halal is still limited to religious needs and only applicable to Muslims. It is considered a given in Turkey and the Middle East, although consumers in this region generally do not place much importance on specific halal branding, certification or country of origin.

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The halal industry in Southeast Asia

Halal is slowly but surely gaining attention in Southeast Asia. Halal-certified food and beverage products and ingredients provide a definite marketing advantage, particularly in Malaysia and Indonesia. Halal health food also appears to be an up and coming sector in both countries.

Malaysia has been aggressively promoting itself as the leader in the global halal industry. Malaysia’s halal initiatives, including certification, have had a flow-through effect on halal development globally. 

In Malaysia and Brunei there’s rigorous application of the halal concept in regulations. In both countries the authenticity and quality of halal food is under government control.

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The halal industry in Europe

Rapid growth in halal consumer segments in Europe has seen halal become a mainstream market segment among the region’s estimated 30 million Muslims. Major retailers, picking up on halal trends, are establishing highly visible and dedicated halal areas in stores. 

They offer a wider selection of halal certified food and beverage products with French retailers sourcing Western Hemisphere halal food. Growth is most noticeable in France and London, particularly in food and beverages.

The trend is predominantly driven by second and third generation Muslims proud of their cultural and religious roots who want to differentiate themselves from older generations. Consumption is heavily influenced by their forefathers’ countries of origin.

Around 80 percent of halal food products in Europe are still sold through neighbourhood ethnic stores and butcher shops. Although meat constitutes the bulk of halal food, most that is sold in butcher shops is not branded or certified.

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Muslim consumer demographics

Halal is considered a given in Turkey and the Middle East, while it is growing strongly in Europe in countries such as France and Germany.

Middle East

• With 99.9 percent Muslim population, and 90 percent of Turks practising Islam at some level, halal food is considered a given in Turkey’s food and beverage industry.
• Halal branding in United Arab Emirates has little meaning as halal is a prerequisite for all imported food.

Southeast Asia

• Indonesia has the largest Muslim population in the world with Muslims making up 88 percent of the total population of 245 million. Halal is considered a given.
• More than 60 percent of Malaysia’s population of 24 million is Muslim and most foods and beverages sold in Malaysia are halal certified. While halal is not seen as a given, it is definitely a marketing advantage.
• The halal market in Singapore is considered an important and integral part of the food and beverage sector. Singapore’s Muslim population of around 650,000 constitutes about 15 percent of the total population.
• Muslims constitute about 4.6 percent of Thailand’s population of 65 million and are concentrated in the southern provinces. Anecdotal evidence suggests that halal is not considered to be a marketing advantage in Thailand.

Europe

• The United Kingdom has a Muslim population of 1.6 million (or 2.8 percent of the total population). Most are immigrants from South Asia, particularly Pakistan, Bangladesh and India.
• France has a Muslim population of five to seven million, approximately 10 percent of its total population. Nearly three quarters of French Muslims are originally from Algeria, Morocco and Tunisia.
• Germany has a Muslim population of 3.5 million, approximately 4 percent of the total population. More than 90 percent are Turkish immigrants. The Muslim population has been growing over the last five years. 

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Health, pharmaceutical and cosmetic industries

The migration of halal certification from the traditional food and beverage sector to other consumer sectors is most likely to occur in the health sector, which encompasses health and food supplements.

Research suggests that the influence of halal in the cosmetic and beauty sector is minimal.

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Challenges for New Zealand companies

NZTE believes there are major challenges for New Zealand companies wanting to participate in halal markets including:

• uncertainty whether the concept can reach beyond religious and racial boundaries and become a mainstream trend
• the lack of a globally-recognised halal standard, resulting in higher operational costs and tedious certification processes
• the market potential still limited to Muslims because halal certification is not a meaningful standard for non-Muslims
• the purchasing power of Muslims in markets like Europe is still relatively low combined with their preference to buy low-cost bulk foods
• marketing of halal products can be challenging and costly due to the various schools of thoughts within Islam. Non-Muslim sensitivities must also be taken into account if the product is meant for a wider market.