By Roger Field
Government interest and increasing consumer demand is helping drive the GCC's organic food sector.
|~||~||~|With agriculture and trade in organic products worth some US $25 billion in 2005, the sector is increasingly coming to the attention of mainstream retailers and farmers around the world. And while Western countries, including Canada and Germany, are leading the way with strong organic sectors, countries in the Middle East are also realising the benefits of food and goods produced naturally.
Shirwa Mohamed, managing director of Gulf Organics, a Dubai-based distributor of organic foods is certainly optimistic about the future of Middle East’s organic sector. He estimates the industry is growing by up to 20% a year in the region. “There has been steady growth, certainly from our experience. I can quantify maybe 20% growth on the conservative side,” he told RNME. “But we anticipate this growth will increase further as the market matures and governments come into line.”
Furthermore, Mohamed thinks governments in the region, particularly in the UAE, are becoming more interested in the organic sector. Indeed, Gulf Organics recently became the first company to gain official organic status, as part of a new accreditation scheme from the UAE’s Ministry of Agriculture and Fisheries.
For Mohamed, the UAE government’s decision to introduce accreditation for companies involved in the sector, including farmers, packers and distributors, was a necessary and positive step. Prior to the accreditation, it was difficult for companies and consumers to determine exactly what organic meant, or to judge whether products were genuinely organic. This situation also made it easier for companies to claim falsely that their products were organic.
“There has been some confusion in the past where consumers were not sure what was organic and who protects them from something like this. This year, the Ministry of Agriculture and Fisheries in the UAE has introduced legislation similar to that of the EU,” Mohamed said. “Gulf Organics has become the first company to comply to the regulations. Our operations are completely certified and we have the certificate. Now all our customers including the local authorities are aware of what we do.”
Gulf Organics advised the government on the development of the legislation, which is intended to allow companies at all stages of the food production process, from farming to distribution, to gain accreditation. “Consumers don’t know our suppliers, so distributors also need to be certified,” Mohamed said. He added that validity of certification is usually between six months and one year.
The UAE is one of the first countries in the Middle East to develop its own certification, although firms in countries that lack such schemes are able to gain organic accreditation from other organisations such as Ecocert, an internationally recognised organic trade body in Germany.
Mohamed is optimistic that other countries in the region will develop their own accreditation systems for companies involved in the organic sector. Furthermore, he added that the sector could benefit significantly if countries across the region adopt similar schemes. “In this way there will not be any complications or problems and confusion in the consumers’ minds or business community,” he said.
Riad Obaidi, a consultant with the organic farming unit at the Ministry of Fisheries and Agriculture (MFA), which is responsible for the certification of organic companies, said the UAE’s organic certification, which only covers goods for local markets, is based on a similar scheme from the European Union.
“We consulted experts who had been involved in the sector for many years,” Obaidi said. He added that companies looking to export organic goods must gain accreditation from an international body, such as Germany’s Ecocert.
And to this end, the UAE government is planning to work with international organisations to assist UAE companies looking to export organic goods. “We are dealing with certain companies to have them working in the UAE under the umbrella of the Ministry,” Obaidi added.
The organic farming unit has already certified one UAE farmer as organic and another is expected to follow next year. Obaidi is also optimistic that many more farmers will follow in the next few years. “I believe next year a lot of people will want to turn organic,” he said.
Despite this, organic farming in the Middle East is in its infancy, and companies such as Gulf Organics tend to import the majority of their products from outside the region, according to Mohamed. “About 90% of our main trading partners are from the EU,” he said. “The rest are mainly from Africa and Australia.”
He added that there is also likely to be a limit to what farmers in the region can produce, given the temperature across much of the Gulf region. “I believe they will not be able to produce a lot of products. We can have things like cucumbers, onions, but they will not be able to grow produce like bananas, mangoes and avacados. They cannot produce wheat, or rice. Maybe 95% of what we consume will be imported.”
He added that the biggest markets for organic consumption in the GCC is Saudi Arabia, mainly owing to population size. The UAE is also strong, particularly in terms of public awareness of organic products.
Despite this, Obaidi has detected a change in perception toward organic farming. “We have noticed that during the past two years there have been a lot of people here that would like to convert to organic, people that would like to buy organics and supermarkets,” he said. “Two years ago, there were very few products in the supermarkets, and they were not organised to handle organic products. Now some supermarkets have sections for organic produce. This is a good sign for organic agriculture.”
Obaidi’s unit in the MFA also undertakes various research projects across the UAE, and these are helping to influence the government to support the organic sector. Indeed, some of the tests have found that organic farming is more productive than previously thought. “We expected a lot of problems with insects and low productivity,” Obaidi said. “But this hasn’t been the case. We found that organic pesticides were effective at controlling many local insects.”
But while the certification scheme is a positive step for the organic sector, Nils El Accad, founder and managing director of Organic Foods & Café, which has two organic supermarkets in Dubai, said the sector is only just starting to take off in the region, and needs more support from consumers.
“There hasn’t been one [an organic sector] in the past couple of years,” he said. “I opened the first organic store at the end of March 2005. It’s not even one year old. Before we opened, there wasn’t really any organics worth mentioning.”
El Accad opened his second organic supermarket a few months ago, but said the market is only picking up slowly. “It’s early days really,” he said. “We haven’t even completed the first season. It’s been slow starting and it’s taking its time. People are so used to what they’re doing they’re not latching on to this new idea too quickly.”
But while El Accad sources the majority of his produce from outside the GCC, and is sceptical about the capability of local growers to bring organic produce to the market, he remains optimistic that the sector will pick up. “There is only one certified farmer so far and he doesn’t have anywhere near the volumes to bring organics to the volume,” he said.
“We’re looking at the second season, so this time next year, we’ll see how much is available. It is all these little things adding together that will eventually make it happen.”
Neil Sorensen, of IFOAM, an international umbrella organisation for the organic sector, agrees that the sector in the Middle East is in its infancy, but is also convinced it has the potential to become a multi-billion dollar industry. He also thinks governments in the region will increasingly move towards supporting the organic sector, not least because it has seen the level of growth of the industry in other parts of the world, including Europe and the US.
“They’re [GCC governments] seeing the possibilities and the benefits and I think they’re coming round to the idea of supporting that,” Sorensen said. “When they do, it could be worth billions of dollars in a very short time.”||**||