Irish Dairy Sector Sees Opportunity in Middle East
IRELAND - With trade regulations easing and growing demand for dairy products in the Middle East, there is a real opportunity for the Irish dairy sector, said James O’Donnell, Emerging Markets Director, Bord Bia – Irish Food Board.
20 March 2012
2 minute read
Dairy is a traditional part of the Middle Eastern diet with consumption of around 1.2m tonnes in 2011. However, due to its naturally dry climate, the Middle East is a milk-deficient region with the majority of the dairy consumption consisting of imported products. Over 70 per cent of dairy products consumed in Saudi Arabia are imported. The figure for the United Arab Emirates (UAE) stands at over 80 per cent.
Due to location and free trade agreements, the EU is a leading supplier of dairy products into the Middle East. Total Irish food and drink exports to the region in 2011 were valued at €250m. Saudi Arabia is the largest regional market for Irish dairy exports accounting for €70m. Milk powders account for 80 per cent of this figure. The UAE is also a prominent market and accounted for €20m worth of Irish dairy exports in 2011.
Food prices have been rising in the Middle East in recent years due in part to monopolistic practices by the import and distribution sectors. The UAE is taking action against this by liberalising trade in 12 areas, including dairy.
It’s hoped that this will stabilise food prices and strengthen the competitiveness of the UAE economy. Food consumption in UAE is projected to show further good growth between now and 2015. The loosening of regulation coupled with this projected growth represents a great opportunity for Irish dairy exporters not only in the area of ingredients but also consumer goods as a large Irish expat community reside in the area.
