Gulfood 2015 Report

Devina Divecha, March 10th, 2015

As the exclusive official publication of Gulfood 2015, Caterer Middle East reviews the latest news, trends and product launches from the 20th edition of the exhibition in Dubai, UAE

The 20th edition of Gulfood took place in Dubai from February 8-12, and saw a number new products and launches at the Dubai World Trade Centre. As always, the show was privy to investment plans and futures being mapped out for the region’s foodservice industry.

Here is our detailed report:

Growth in Regional F&B
With the growth in the food and beverage sector in the region, various companies took to Gulfood to announce their expansion plans and entry into new countries in the market.

One of these companies is Aujan Coca-Cola Beverages Company (ACCBC) , which revealed that it will invest US $500 million in the beverage industry in the next three years. The cash injection will include a series of capacity improvements, innovations to packaging and consumer occasions, as well as IT upgrades.

Nicolaas Nusmeier, chief executive officer of ACCBC, said: “Robust expansion plans will enable ACCBC to realise the vision of its shareholders across the Middle East and North Africa.

“We already have a portfolio of strong brands, and an excellent track record as a regional beverage operator. Major investments in capacity, geographical coverage, and brand development will allow us to capitalise on the growth potential for the beverage industry in the MENA region.

“Despite political and economic disruption over the past few years, the regional beverage market has continued to grow, and we expect this to continue. For ACCBC, an increasingly youthful population across MENA, together with opportunities for new categories and fresh consumer-focused innovations mean significant growth prospects.

“ACCBC is putting in place a strategy to become one of the biggest beverage operators in the region, growing from a company within a single category and a limited geography into a total beverage, multi-country, powerhouse.”

In 2014, ACCBC delivered double-digit volume growth and completed the acquisition of a majority stake in the National Beverage Company S.A.L (NBC), the manufacturer and distributor of Coca-Cola in Lebanon. In addition to this, ACCBC last year confirmed plans to open a factory in Egypt to supply its brands to the Egyptian market, with expansion potential across Africa.

In Algeria, the volume of ACCBC’s flagship brand Rani has grown more than 300% in the last four years. ACCBC is the authorised manufacturer and distributor of the Rani and Barbican brands, as well as the licensed manufacturer in the Middle East for Vimto.

Similarly capitalising on the increased demand in the market, UAE-based baking company Bakemart will be opening a new production facility in Dubai Industrial City, the company’s managing director TK Khaleel told Caterer Middle East.

The new facility will add to Bakemart’s current production plant in International Media Production Zone, which produces over 300,000 units of bread, pastries, and other baked goods on a daily basis. The production capacity at the new factory will double the company’s existing output.

Article continues on next page ...

Commenting on Bakemart’s future expansion plans, Khaleel said: “We are also planning to open a production facility in Oman in Muscat. We are also very seriously looking in the Saudi market, so we plan to be present throughout the region in the next couple of years. Oman will open this year, and Saudi might be end of this year or beginning next year.”

The company also launched its new line of bread and baked goods called World of Artisan Breads at Gulfood, which features 25 new products, including organic bread, gluten-free baked items, and sugar-free pastries.

“The demand for artisan is increasing in the region; in the US and Europe it’s very common. People want something different, and I am sure the artisan range will be very successful here,” Khaleel added.

Speaking about companies looking at increasing their footprint in the market, Solico is a family-owned business based out of Dubai with manufacturing operations in Iran, Iraq, Egypt, among other operations further afield.

Solico Group regional sales director foodservice & industrial GCC Mat Baker told Caterer Middle East: “The business historically has been focused in the Northern Gulf and CIS regions. But there’s a new focus now — and part of the reason why we’re here at Gulfood — to look at the opportunity of bringing the products and the Solico name into the GCC and the North Africa region.”

The range of products offered is very broad, but the core business is dairy. Baker added: “In the Gulf, where there are a lot of reconstituted products, our natural production comes through the product. It really has that richness and depth of dairy that you associate more with European or Australasian brands, than those produced in this region.”

Ranges Baker revealed he thought would be most popular included the natural cheese range, chocolate products, and confectionery cream. He said: “We will look to establish the cheese, the chocolate and confectionery cream businesses, get chefs to try them, get their feedback and show them Iranian-sourced dairy products have got something to add to the market, and use that as a platform to talk about the other range.”

He noted: “We have our own distribution within the UAE so we are able to fulfil requirements already; we are talking to one or two other specialist distributors as well to look to have a better route to market.”

Baker stressed it was crucial that the company offers a quality product, a price point and value proposition that gives it a reason to be in the market.

“We believe that on our core product offering, we will offer significantly better quality than most of the local suppliers and at a comparable price.

The supply chain is shorter, the product is fresher, and the cost of sourcing is competitive. Obviously the fact that it is regional has some benefits with the local chef community looking to be greener with the supply chain. But in the end we’re being realistic about the hard commercial drivers as well.”

UAE-based Sparrow International also re-affirmed its plan to open its first office in Saudi Arabia this month, sales director Nader Hijazi has told Caterer Middle East.

Article continues on next page ...

The company, which offers a full range of products and services for coffee shops and gelateria also recently opened a new 1000m2 facility in Dubai, which houses the offices, warehouse, training centre, and gelato production area.

Commenting on the company’s growth, Hijazi said: “We opened Sparrow International two years ago. We had a very small office in Safa, and in two years we now have several major brands from Italy — coffee machines, coffee beans, accessories, training, consultancy, anything related to coffee, tea and gelato.

We are opening an office this month in Saudi Arabia because it’s a massive market to cover. The headquarters is here in Dubai, and we cover the entire region.”

Sparrow International is also in the process of signing up with Erremme to distribute its ice cream packaging in the GCC.

Diversifying in this market is also a trend we noticed, with Jebal, the UAE-based supplier for vegetables and meat, announcing its entry into the region’s foodservice sector, with hoteliers like Jumeirah, Kempinski, Starwood and Accor already on board as clients.

“Our strategy is to be fully integrated. We are not changing lanes but extending options, so we can reach direct consumer, offer import, storage and distribution services, and finally go into retail,” said Jebal managing director and founder Driss Dehbi.

In three years since its inception, the company has established an international network of suppliers to ensure consistent supply for its clients. It insists on introducing new products periodically to offer an “integrated solution”, as Dehbi said.

Commenting on the seasonal nature of seafood, Dehbi said: “We are tying up with a lot of regions so we can ensure consistency in supply, all year round. We are tying up with South of France for Mediterranean seas, then Morocco, Yemen, Madagascar, et cetera. We are enlarging the sourcing network to secure the all-year-round business of the product. We will make chefs confident to write on their menus the different and new varieties of fish, which are internationally known.”

For 2015, Jebal plans to focus on expanding its product range and becoming a key supplier for Horeca clients. Moreover, it also intends to establish a retail presence, with its first outlet already launched in Abu Dhabi.

American Garden is another firm which has diversified in the market, with the expansion of its range called Professional Host. Marketed as a cost-efficient range for caterers, the brand was launched in the Middle East in Saudi Arabia, and Gemco assistant brand manager AlyshiaFazal said: “We have created this division called Professional Host, where our focus is catering to professionals, and being able to provide the bigger packs. It is a relatively new venture for us so it is something we are constantly developing.

“We had the retail packs — people loved the product but they had to buy small packs, which was not cost-efficient. That’s when we started venturing to this segment. I believe this is going to be a huge segment for us and it’s going to be a standalone aspect of our company.”

Gemco regional sales manager Middle East Majid Ali added: “We are present across the region, it’s just that we are now emphasising on developing this range.”

Article continues on next page ...

And while Gulfood 2015 saw a host of major companies bringing their latest products and offers, the event also saw plenty of smaller businesses looking to make an impact and capture new markets. Among them was Koita, exhibiting for the first time with its own stand within the American pavilion. The company has offices in Chicago and Dubai.

The company distributes a range of American snacks, including Cape Cod potato chips and Snyder’s pretzels, as well as Gococo coconut water, which has no added sugar, and its own branded organic milk.

Speaking to Caterer Middle East, founder and CEO Mustafa Koita explained how, while retail had been the focus until now, he was now in discussions with the Horeca industry.

“At this event, we’ve been approached by a tonne of Horeca guys. And our coconut water has shown up at some of the hotels, the brunches. There’s a whole rehydration thing going on.”

He also detailed how the company had grown over the last three years, building on the increasing demand for organic and healthy food and snacks. Koita added: “We’re not there yet, but I think we will be there quickly.

“This is the first year we’ve had our own stand, and it has been so good. We’ve gone through all the growing pains of a smaller company, and we’re learning to do things on our own — working with the government on food compliance and teaching people about organic.”

Health and Wellness
Speaking about organic and healthy food and snacks, the exhibition this year showed a marked trend towards health, nutrition and wellness in its products — from ingredients to equipment.

Canada Beef highlighted the nutritional benefits of the meat it supplies. Robert Serapiglia, director of busines development and innovation at Canada Beef, said: “We’re expanding our messaging from just brand awareness to nutrition,” he said. “We have our registered dietician attending [Gulfood], putting the focus on the nutritional powerhouse that beef is.

“Health and nutrition is always a focus, especially in a demographic that has an older population. Beef complements a nutritious diet very well and we are here to educate not only health professionals, but also the industry on what those healthy attributes are.”

In equipment, Greenfield World Trade showed its commitment to health and wellness with some of its new products. One of its manufacturers, Excalibur, is involved with dehydration for health and wellness, otherwise known as drying.

Greenfield World Trade vice president Jonathan Vadnos said: “We can take any product — protein, meats and fishes, vegetables, fruits — and over anywhere from a 6-20 hour period, depending on the thickness of the produce, extract all the water from that product.

The great thing about dry food is that it leaves all the minerals and the vitamins, essential nutrients inside. Then you’re able to store it at room temperature, no refrigeration needed, for years and years, up to around 15 years. So you can produce dehydrated bananas, apples, beef jerky, dried fish.”

He continued: “Health and wellness is becoming a trend on a global basis because people want to reduce and combat and fight diabetes, obesity, high blood pressure, leukaemia, cancers. Between the current two pillars of health and wellness, ie dehydration and juicing, we are able to support the industry with our Omega juicers and Excalibur dehydrators.”

JM Posner was also attracting a lot of crowds at its stand keen to try out the new LightFry oven, which can prepare fries without the need for a single drop of oil. Other fried foods can also be cooked in the machine, such as onion rings, chicken nuggets and breaded mozzarella.

The two-phase patented preparation process sees steam thoroughly cook the fries, before a stream of hot, dry air gives them a crispy surface, and are 40%-60% lower in fat.

Trade, Tourism and Investment Office of Peru in the UAE’s director Alvaro Silva Santistebansaid that one of the first products he wanted to introduce when he arrived in the Middle East was quinoa.

He said: “Nobody knew about quinoa, nobody wanted quinoa, it was like a myth. Today there’s so much demand for quinoa that we have to produce extra.” The firm is looking to strengthen its presence in the superfood sector with other grains as a complement to this health product.

Article continues on next page ...

Global Interest
So it’s not just local or regional companies that were making their presence felt. A vast number of country pavilions were located at Gulfood, many of which were looking to cash in on the extremely lucrative Middle Eastern market.

Starting in the East, Japan External Trade Organisation (JETRO) and Ministry of Agriculture, Forestry and Fisheries (MAFF) participated at Gulfood for the second year running, with 24 companies and Japanese Wagyu beef as a headline product.

Prior to Gulfood, a Japan Food Tasting Seminar was held to introduce the exhibitors and products on offer. At the event, JETRO managing director Masayoshi Watanabe said: “Our authentic and traditional Japanese food items are essential for Japanese cuisine but are not easily available in the region.”

Some of the exhibitors at the Japanese pavilion already supply to five-star hotels and restaurant chains, like Zuma and Nobu. However the export and reach is still constrained. Watanabe said that although the number of exhibitors at Gulfood’s Japanese pavilion and Japanese restaurants in the region have increased, there is a lot more potential for export and Japanese products in the Middle Eastern market.

Currently, Japanese exports to UAE mainly comprise non-alcoholic beverages, like energy drinks, and at Gulfood this year, JETRO tried to focus more on food items and authentic Japanese ingredients.

According to Watanabe, last year’s exports from Japan to GCC amounted to US $400 million, and he believes that it can increase manifold.

Moreover, Watanabe also stated that although Japanese manufactures are aware of halal procedures, the restriction does obstruct the exports. “I agree that if there were no halal restrictions, exports from Japan to UAE would have definitely increased majorly. Halal business in the world is so huge — with a world population of almost two billion Muslims and market value of approximately $6 trillion.”

Now heading to Europe, French food exports to the UAE surpassed €350 million (US $396.3 million) in 2013, Business France trade commissioner UAE and Qatar Francois Sporrer told Caterer Middle East.

The French pavilion hosted over 100 exhibitors at Gulfood, Sporrer said the UAE and KSA are very important export markets. “The UAE is more important not just for its own consumption but also as a hub, because some products are exported to Dubai and then re-exported to neighbouring countries,” Sporrer said.

“Last year alone, France exported €350 million of food to the UAE, which is about 10% of total French exports to the UAE, so it’s a really important part of what we export to this country. We are not on volumes, but rather on high-end and quality products, which is why we are so interested in the development of the tourism industry,” he added.

French food-related exports to the region include dairy, apples, pastry ingredients, egg products, and baking equipment. “France is the number one supplier for bakery products in the UAE, such as ovens, as well as kitchen equipment. You have the full spectrum but bakery is really the stronghold for French exports to the UAE,” Sporrer explained.

He also revealed the trade commission’s plans to focus on the meat market in the region. Sporrer said: “We believe we still have a strong opportunity in the meat sector. For now, we export mainly chicken and very specific meats, but two years ago we opened the local market for French beef again and we want to capitalise on this open door.”

Article continues on next page ...

He added: “We have slowly started in some niche markets with premium beef meat, but we want to have a broader spectrum so people can have French beef in the hypermarket and the hotels and restaurants.”

Moving towards the United Kingdom, four companies from Scotland exhibited at Gulfood for the first time.
Scottish Development International (SDI), which helps to promote Scottish products around the world, brought along a number of new exhibitors to Gulfood this year.

Among the new companies at the event were dairy company First Milk, which was showcasing its signature range of cheddar cheese for the first time in the Middle East, and Ronan Foods, which was exhibiting its ice cream style desserts, among other products.

Also at the show for the first time was sweet biscuits and savoury snacks producer Pulsetta and global packaging manufacturer Vegware LTD, the latter of which won a Gulfood Award for Best New Catering Equipment Innovation Award (see box out on pg 53).

Meanwhile, new products launched within the Scotland pavilion included Reids of Caithness’ Caithness Scenic Range, pre-packaged mini packs of shortbread cookies, and Maclean’s Highland Bakery’s Luxury and Mini ranges of its sweet confectionery and oatcakes.

Shortbread House of Edinburgh also introduced its new retail and foodservice packaging, designed to appeal to a younger market for its hand-made Scottish shortbread products, oat biscuits and Dundee cakes.

Tom Marchbanks, regional manager Middle East, Scottish Development International, said: “Scotland is blessed with a fantastic larder of some of the best natural produce in the world, and our food and drink industry is thriving.

In addition to having a reputation for producing indulgent and premium foods, Scottish producers are really stepping up to the mark to meet consumer demand for luxury and healthy products. And the variety of new products being launched at the show is testament to that.

“That Gulfood has been chosen as the platform from which to launch these new product innovations reflects the importance of the Middle East market to these companies.

“We know they are keen to impress the chefs, buyers and other decision-makers in this region and keep up with the increasing demand for luxury, healthy, innovative products backed by Scottish heritage.”

Staying in the UK, the GCC is on the radar for Welsh product exports in 2015, with companies who participated in the Welsh pavilion having affirmed plans to penetrate the Middle Eastern market this year. They have clear strategies in place, including culture-sensitive products, local partners and aggressive marketing plans, to capture a considerable market share.

Dairy products from the region have already made it to the high-end retail chains, including Spinney’s, and companies plan to collaborate with local partners to further infiltrate the market, and reach out to the highly-competitive hospitality and aviation industry.

Article continues on next page ...

Snowdonia Cheese Company commercial director Richard Newton-Jones said: “GCC is a key market for us, based on the speciality cheese consumption. We want our range of six flavoured cheese to be listed in all the reputable retail stores in UAE.

“It has great application for in-flight catering and a lot of hotels, like Westin Hotels, are very interested in the product. We will be working with a local partner here to work on the marketing strategies for the region.”
Additionally, suppliers from Wales believe that adapting to local culture and traditions is the key to success in the region.

Burts Biscuits and Cakes, one of the Welsh exhibitors, confirmed that GCC is its second biggest market outside the North America, contributing 17% to the company’s total turnover, and credits localising products for its acceptability and reach in the market.

Burts managing director Edward Burt commented: “We have certain items we use for Christmas, and there are areas within this region, like Kuwait for example, where we refrain from using the word Christmas. We generalise the products and are sensitive to the culture.”

The Welsh pavilion also comprised meat producers who aim to enter the foodservice industry in the region; however, their entrance is marred by cheap meat alternatives, according to the exhibitors.

Randall Parker Foods revealed that its exports to GCC make about 1% of its total exports currently, and they airfreight two tonnes of meat, thrice a week, to UAE.

“The challenge for us in this region is the cheaper lamb from Australia and New Zealand, because it’s pretty much a commodity product and it arrives via sea freight in containers. Also, the locally produced lamb and the lamb that comes from Pakistan and India is also competition. It’s a lot cheaper. Ours is airfreighted as it’s a premium product,” said Randall Parker Foods senior sales manager Graham Penny.

However, he added that Welsh meat producers are still hopeful. “I think price would be less of an issue now that the recession is over. And you have top entrepreneurs and businesses coming back to Dubai, so price would become less of an issue. They would go back looking for quality, and that’s where Welsh lamb would be found.”

South American countries also heavily showed their clout at the show. The organisation which promotes Brazilian products around the world is looking to help the country diversify its offer to the Middle East well beyond meat.

The Brazilian Trade and Investment Promotion Agency (Apex-Brasil) was among the biggest exhibitors at Gulfood 2015. Speaking to Caterer Middle East, Ely Michel Dauly, COO for Apex-Brasil’s MENA office, explained how diversification would play an important role in building on the US $650 million in deals signed at last year’s event. “Brazil is the leading exporter of meat, beef and poultry,” he said.

“This is one of our goals, to diversify. That’s why we have 72 companies, offering different products: juices, milk products, biscuits, honey. There are many products to offer. This is our challenge — to improve the level of information about Brazil.

“Also there are direct flights to Dubai and Abu Dhabi, so now we feel the awareness is much better. But we still have to work on it.” He added that Brazilan suppliers were seeing increased demand from the region, particularly in the UAE, Saudi Arabia and other GCC countries.

Article continues on next page ...

Another South American country, Peru, showcased its range of produce after it was revealed that total exports to the UAE grew by 700% between 2011-14.

Nine food sector companies from Peru participated at the event, and according to Ernst & Young’s 2014/5 Peru Business & Investment Guide, in addition to being the number one exporter of organic coffee and producer of paprika, organic bananas, fishmeal and fish oil, Peru is the second ranked exporter of asparagus and avocados, number four exporter of evaporated milk and top 10 mango producer.

Trade, Tourism and Investment Office of Peru in the UAE’s Santisteban told Caterer Middle East: “We saw a growth of more than 700% in terms of our exports. The region represents a new frontier for us.”

He said that Peruvian exports are already very consolidated in the American and European market, and the GCC is one of the platforms where the company wants to capitalise on. Santisteban added: “In addition to the UAE, Saudi Arabia has shown a very big growth, as well as Kuwait and Qatar.”

He continued: “The latest figures that we received, in terms of fresh produce, from 2013-2014, is that the exports of fresh produce from Peru to Dubai have increased by 250%. This is the most solid market. The US increased by 45%, Europe increased by 40%.”

Peruvian aquaculture is also an important economic contributor with $89.4 million worth of exports recorded in Q1 2014, which represented a 62% increase over the same period in 2013, according to the Association of Exporters.

However, Santisteban said: “We would like to see our growth on the seafood side. We had a good start a couple of years ago but it hasn’t grown like the other sectors have. So we’re going to focus on that.”

The firm also plans to fortify its presence on the superfood side, along with increasing citrus food exports, and on avocados, mangoes, grapes and asparagus.

Companies at the Peru National Pavilion showcased products including fruits and vegetables, quinoa grains and flour, raw cacao powder, chia drinks, spices, gourmet dips, evaporated milk, dried fruits, fair trade jams and juices, and organic coffee.

Moving to the North American continent, Canada Beef, which markets and promotes the Canadian cattle and beef industry around the world, used its presence to speak about the organisation’s latest developments, and the state of Canadian beef in the region at the moment.

Serapiglia detailed how the producers from Canada were continuing to focus on supplying premium beef to the region. “The focus is on premium retail and premium foodservice,” he said. “It’s strategically focused [on markets] which are not price sensitive. Canadian product is world class, it’s grain finished, well-marbled, very flavourful and tender.

“It’s definitely not a least-cost product. We have expensive production systems, there is the freight logistics, so it is very niche-specific.”

Canada Beef has been active in the region at trade shows and with its branding series over the last five years. Serpaiglia explained how demands were evolving to secondary cuts, such as hind cuts and shoulder cuts.

“The demand is for aged, grain-finished, well-marbled product. Middle meats [loin and rib cuts] sell all the time. We’ve seen an increase in trade of complete carcasses, we’ve seen the market start to diversify in what it offers. We see premium gourmet burger opportunities come out of this growing demand; we also see alternative steak opportunities.”

All in all, the exhibitors exuded a sense of confidence in the region and their products, with expansion well on the cards.

The 21st edition of Gulfood will be held from February 21-25, 2016 — will you be there?