Middle East Markets Keep Growing Despite Political And Religious Unrest

Developed countries have reached their peak in terms of canned tuna consumption; that’s according to one economist, who believes that several markets which have been overlooked up until now, are about to get their time in the limelight as urbanization, growing populations and religious unrest all have a part to play in climbing tuna consumption.

The Arabic world is a prime example, where rising canned tuna imports have been going relatively unnoticed. Most recent data from 2014 shows a year on year rise of 15 percent in canned and pre-cooked loin deliveries to the region, and an almost 30 percent rise in these shipments since just 2011.

The vast majority of this tuna originates from Thailand, and of the total 161,969 tons sent in 2014 to the Middle East, over a third was delivered to Egypt. Saudi Arabia also took a significant 16 percent chunk of the purchases, while the United Arab Emirates and Israel purchased just less than 15 percent each.

As a whole however, not much is commonly known about the tuna consumption habits of Middle Eastern citizens, but according to one of the biggest tuna brands in existence in the region, California Garden, there are significant differences between countries.

California Garden currently holds around a 20 percent share of total tuna imports into the region, and according to data from the firm, the area’s biggest importer Egypt, is primarily a flake market, with skipjack packed in oil being the norm.

Just across the Red Sea in Saudi Arabia, the opposite is true; high quality solid pack skipjack dominates the market, while flaked tuna constitutes less than 10 percent of sales. With a population of just over six million, California Garden notes Libya to be one of the highest consumers of canned tuna per capita in the world, where good quality chunks in oil are most prevalent.

Kuwait and other nations surrounding the Persian Gulf, such as Qatar and the United Arab Emirates, are mostly skipjack chunk markets, although small volumes of albacore and yellowfin are also available to consumers. Some importers suggest that tongol is also appreciated in the Arab market, although California Garden clarifies that deliveries coming from Asia can often be sporadic, lessening tongol’s overall market share.

However market preferences and overall import tonnages cannot always be 100 percent relied on in this part of the world to judge tuna consumption. Speaking to economist and emerging markets expert Dario Chemerinski, there is a reminder that these Middle Eastern markets are not as developed as common tuna hubs.

In keeping with its status as the area’s largest canned tuna and pre-cooked loin importer, Egypt is also reported to be a hotspot for tuna smuggling, with most of this illegally transported tuna heading to Libya, before being moved even further west to Tunisia.

But even with this illegal movement of tuna between countries, Chemerinski says it’s clear that this is a region with some serious potential. He says that collectively the 18 countries which make up the Middle East are easily a billion dollar business, with skyrocketing possibilities.

With imports to some developed nations around the globe slowing, stagnating or even falling, Chemerinski puts forward seven key factors which are contributing to changes in canned tuna consumption in many developing, and increasingly urban, Middle Eastern nations:

1. Population Growth
More people means more overall food consumption.

2. Urbanization
Increasing dependence on city grocery stores rather than traditionally farmed food. Even the expansion of the Subway sandwich chain is having an impact, says Chemerinski, with over a 100 urban stores opening a year retailing the best-selling tuna sub!

3. Rising Living Standards
Emerging middle classes present new opportunities for firm’s to start catering for new demands.

4. Meat Protein
Chicken and beef are the most popular proteins, but not the healthiest on the market. An emerging middle class with more disposable income will have the power to shift to a healthier fish diet.

5. Retail Development
Annual indexes published to help global retailers prioritize expansion investments have shown Middle Eastern markets such as Turkey climbing steadily in the ranks as desirable places to expand.

6. Muslim Population
With Islam as the primary religion of the Middle East, the halal market is booming. According to the Quran, all seafood is halal. Imagine Egypt’s 80 million Muslims switching from chicken to tuna, Chemerinski says.

7. Presence of Tuna Plants
Local manufacturing of canned tuna encourages product penetration, such as regional governments incorporating it into school meal programs.

In addition to these reasons, a source within California Garden’s Middle East division previously told Atuna that shelf-stable, highly nutritious tuna packed with proteins also provides the ideal food to feed a war torn zone. Talking about Syria in particular, a nation whose canned tuna imports from Thailand have been steadily rising since unrest began in the country in 2011, its clear that canned tuna can provide an important resource for nations in crisis.

Special mention should also be given to Iran, according to Chemerinski, as a country which has seen trade sanctions with the UN lifted earlier this year after nearly four decades of red tape. Although import duties are reportedly very high, our source says the market is vast and full of consumers who already have a taste for relatively good quality canned tuna.

With such growing potential, economist Chemerinski says that the Middle East market is one which cannot be ignored, and with developed markets around the world having reached their full capacity, companies set on expansion need look no further than the Arab world.

Although several firms have recognized this, one of the first big tuna companies to invest in the region is Thai Union. The firm signed a joint venture in September last year with Savola Foods to bring its major EU canned tuna brand John West to the region; which as a whole boasts a population of more than 409 million people. However, only time will tell which other companies will seize the opportunities presented in the Middle East, and how the tuna landscape of these Arab nations will change over the next ten years.