One amazing aspect of capitalism is that markets operating under this system harbor no biases; they are commercial to the core. With too many loose ends of capitalism showing off in the last three decades, the world at large hardly desisted from embracing Islamic finance. Same is the case with Halal food industry, which has grown worldwide at an amazing pace. According to the Dubai Chamber of Commerce and Industry, Halal food market size had grown to $1.1 trillion by 2013 and has a potential to go up to $1.6 trillion by 2018. According to the same source, Halal food market (HFM) share was 16.6 percent in 2012. So, capitalism means business!
The idea of Halal food essentially comes from the teachings of Islam that, in this particular context, have appealed to the non-Muslims too, though not strictly with the same gravity and fervor as peculiar to Muslim minds. Hygiene and humane treatment of animals are the two aspects that have impressed non-Muslim minds most. A Canadian report states in its concluding remarks:
“Changing world demographics and increasing global demand are resulting in new opportunities in the global Halal food market. The growing Muslim population will increase demand for Halal food products, and the emergent consumer market of non-Muslims, which consume Halal food products for ethical and safety reasons will become increasingly important. Increasing incomes in majority-Muslim countries around the world have driven consumers to seek new and differentiated Halal certified products that are not readily available in the market.”
The chief drivers of HFM growth are: the fast-growing Muslim population, increasing incomes in majority-Muslim countries, and non-Muslim acceptance of the merit of Halal food products. Relying more on purity than greed, both Islamic Finance and HFM stood firm in the aftermath of 2007-8 global financial crisis. During 2004-10, HFM grew by 12.6 percent. In 2010 alone, HFM recorded a growth of 4.3% after which it charged up and went all-guns-firing, registering a phenomenal growth of 66 percent in the next three years.
GLOBAL HALAL FOOD MARKET SIZE BY REGION (AMOUNTS IN BILLION US$)
Total HFM size
Source: World Halal Forum 2009 Post Event Report and the 6th World Halal Forum Presentation
Enormous challenges to HFM come from conventional Western food markets. Although chains like Macdonald, KFC and others recognize the importance of Halal food and endeavor to create niche Halal food market for themselves, the overall Muslim consumption pattern holds key to the future of HFM. To understand this, the concluding remarks of a 2011 Global Pathfinder Report should come in handy. The report mentions: “The international Muslim population is expanding in terms of size and geography, resulting in increased demand for Halal food and beverage products. Furthermore, increased globalization is leading to changes in the social behaviors and attitudes of the younger Muslim generations, creating unique product needs. While they remain Halal conscious, they still want to eat Thai food, Chinese food, pizza and burgers. This is coupled with a growing segment of non-Muslim populations that are seeking out Halal products for health or environmental reasons.”
Muslims account for around 25 percent of the world population. This sets a huge scope for Halal food markets. Nevertheless, the food habits of younger Muslims, the varied standardizations among Muslims themselves and inequality of incomes are substantial drags on HFM growth within the Muslim segment of world population. The growing inequalities of income that are the logical outcome of pro-rich capitalistic system may adversely affect HFM growth trends for well-packaged and well-marketed Halal food products carry a premium price, which the poor find difficult to manage. If the standards of Halal food products are strictly adhered to, the growing number of rich Muslims and hygiene-conscious/animal-caring non-Muslims are there to sustain Halal Food Market.