Middle East Offers Opportunities for Beef Sales to U.S. and Competitors
The Middle East has generated headlines in recent weeks for political instability, but talk of growth and optimism were in the air at the Dubai International Convention and Exhibition Centre as leading food processors from around the world packed more than 1 million square feet of exhibition space in a region that boasts more than 350 million consumers and among the highest growth rates of anywhere in the world.
“We are seeing continued economic expansion and population growth – both of which are positives for the future of U.S. beef in the Middle East,” said Dan Halstrom, USMEF senior vice president of marketing and communications.
Along with John Brook, USMEF director for the European Union, Russia and the Middle East, and Simon Bahkt, USMEF representative in the Middle East, Halstrom participated in Gulfoods and visited Saudi Arabia and Jordan to assess prospects for U.S. beef in the region. USMEF’s participation in Gulfoods was supported by the Beef Checkoff.
“U.S. beef middle meats continue to be featured at white tablecloth restaurants and hotels throughout the Middle East where they are the preferred fare in terms of eating quality, and we’re seeing interest in other cuts, including two-piece chucks, top sides and sirloin meat,” Halstrom said. “There is fierce competition from Australia, India and Brazil, which traditionally dominate imports to this market, but U.S. beef is becoming more competitive in terms of price and availability to the retail and further-processed markets.”
Egypt, with a population approaching 80 million, continues to be the leading Middle East market for U.S. beef but Saudi Arabia, with about 26 million people, is a legitimate market for expansion for U.S. beef in the future. Other smaller but key beef export destinations in the region include the United Arab Emirates (AE), Kuwait and Jordan.
As a region, the Middle East imported 134,510 metric tons (296.5 million pounds) of U.S. beef in 2010 valued at $261.2 million – increases of 36 percent in volume and 77 percent in value over the previous year. Egypt accounted for nearly 85 percent of the volume and 68 percent of the value of those imports.
While the region remains the United States’ top export market for variety meat – primarily to Egypt – the greatest growth in beef exports to the region is in muscle cuts. Last year, those exports jumped 87 percent in volume and 113 percent in value to 45,768 metric tons ( ) valued at $158 million.
The trend continued in January of 2011 – prior to the outbreak of violence in several countries – as total U.S. beef exports to the Middle East jumped 53 percent in volume and 98 percent in value over January 2010.
“There are a number of quickly developing market segments in the Middle East including quick service restaurants (such as Burger King and McDonald’s) as well as family-style dining establishments,” said Halstrom. “As the economies in these markets continue to develop and the population grows, you can expect this segment of the business to see significant expansion. We’re also seeing emergence of take-out windows and home meal delivery, which adds to our opportunities.”
While the U.S. share of the beef market in the region is growing, Halstrom noted that the competition is diverse and well-funded. For example, the UAE had 44 different countries ship product there in 2010. The U.S. ranked fifth behind India, Australia, Brazil and Pakistan.
“Right now, most of the U.S. beef going into the Middle East is frozen, but there is an opportunity in the future to maximize quality by expanding the percentage of cuts that enter the region chilled,” Halstrom said. “From USMEF’s perspective, the Middle East is just beginning to emerge in terms of demand, and we are gearing our programs there to capitalize on future opportunities.”