PRODUCT MARKET STUDY: UK HALAL MARKET FOR FOOD PRODUCTS & NON-FOOD PRODUCTS (COSMETIC AND TOILETRIES) Date : January 2006
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Product Definition Halal applies to all facets of life, including products, material, ingredients, services i.e banking and insurance. In most contact, Halal is largely used in relation to foods, meat products, cosmetics, personal care products, leather goods and food ingredients. According to The Muslim Council of Britain (MCB), for a product to be Halal it must be: Free of, and not containing any substance or ingredient taken or extracted from a Haram animal or ingredient. All the raw material and ingredients used must be Halal. From naturally Halal animals, such as cattle, goat, sheep, etc. and slaughtered according to Islamic rites. Made, processed, produced, manufactured and/or stored by using utensils, equipment and/or machinery that has been cleansed according to Islamic law Free of contamination and must not come into contact with Haram substance during preparation, production, manufacture processing and/or storage. Halal ingredients must not be mixed with objectionable ingredients. Any group of foods cheese, meat etc., may be combined with others and consumed, as long as not prohibited foods are included.
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Halal Market Size and location According to the official 2001 census, there were 1.6 million Muslim living in Britain. The Muslim Council of Britain (MCB), estimated the actual figure to be closer to 2.5 million in 2005, taking into account new immigrants, non-registration and unaccounted illegal immigrants. Muslims were the largest religious group after Christians. Muslims comprised 3 per cent of the total population. Around two-fifth of Muslims (38 per cent) lived in London. After London, the regions with the next biggest share of the Muslim population were the west Midlands (14 per cent), the North West (13 per cent), and Yorkshire and the Humber (12 per cent). Even within these regions, Muslims were highly concentrated spatially. Muslims made up 8 per cent of
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London‟s population overall but 36 per cent of the Tower Hamlets and 24 per cent of the Newham populations. Three quarters of Muslims (74 per cent) were from an Asian ethnic background, predominantly Pakistani (43 per cent), Bangladeshi (16 per cent), Indian (8 per cent) and other Asian (6 per cent). One in 10 Muslims (11 per cent) were from a White ethnic group, 4 per cent were of British origin and 7 per cent from another White background including Turkish, Cypriot, Arab and eastern European. A further 6 per cent of Muslims were black African origin, mainly from North and West Africa, Particularly Somalia.
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Latest Market Trends and opportunities The emergence of Halal requirement in the marketplace, has not only focus on food, but encompassing all other aspects of life and commerce. The scope is vast and the potential for expansion and development of this market is so far unmeasured and certainly untapped. The Halal marketplace encompasses all of the products and issues relating to Halal food and beverages, but it does not stop there. Cosmetics, toiletries, pharmaceuticals, medicines, biotechnology, travel and tourism, banking and finance, insurance, storage, shipping, packaging, publishing, branding and marketing, clothing and fashion - all of these, and more, all could be categorise within the Halal concept. Britain‟s cultural diversity means that Halal products are not only important to the independent stores and restaurants, farms, abattoirs, butchers, distributors, importers and exporters and wholesalers within the Muslim communities, but they are also growing in importance to mainstream retailers and supermarket chains. This is also true for those in charged with the responsibility for producing food within the public institutions such as Britain‟s schools, universities and hospitals. In the latest census about eight per cent of the UK population is from the minority groups. If the population of ethnic minorities grows by just four per cent each year non-white British shoppers will be a majority before 2100. The UK Institute of Public policy research (IPRR) revealed that 41 per cent of immigrants are based in London, making up a quarter of the capital‟s population. In the past 15 years, Britain has become more diverse and it is now home to communities from every corner of the globe.
Many mainstream retailers are already changing their products ranges to cater for their needs. Mainstream supermarket such as 2
Tesco has started puting a lot of effort into tailoring offers for their ethnic customers as well as to meet the local population demands. In one of the Tesco branch, where large population of ASEAN community live, the Tesco store carries more than 800 speciality Asian lines, from halal ready meals to Bollywood DVDS and this is one of Tesco‟s highest turnover stores. In some catchments where non-white are majority, they stock halal meats and ingredients. Tesco Extra in Slough for example, is working together with the National Halal Food Group by opening a „ National Halal‟ Centre in this store for fresh Halal meat and poultry from November 2005. This business venture is initiated due to the growing demand from the local Muslim community for Halal Meat and poultry and also Tesco responds the need of the local community. Tesco is set to carry extensive range of halal products which could include non-food products as well.
Cultural catering is now the main theme in retailing in UK. Somerfield and Kwik Save (UK mainstream supermarkets) are launching a range of 160 branded authentic ethnic food products across their 400 stores. The policy is to cater for the needs of a wider consumer base, which include provision of Halal product. Latest research shows that a total of £474 million was spent in the year ending August 2005 on ethnic chilled ready meals. A ready meal is seen as convenient and while in the increase in the range of ethnic foods on offer has attracted white British buyers. The figures suggest that both the number of ethnic shoppers and demand from all groups of consumers for ethnic food are increasing in the mainstream supermarket.
The popularity of halal non-food products such as cosmetics and toiletries are not as evident as that of foods. UK consumers are more concern about food products that they consume than that non-food that they use. This especially so true, with the younger generation of the UK Muslim population.
However, the recent emergence of wellbeing trends which favours the use of natural ingredients, which are mainly used by Halal product manufacturers, could spark off the interest in Halal cosmetics and toiletries. Malaysian manufacturers are already producing these products and in a good position to penetrate the UK market. Also In recent years, the UK personal care industry has witnessed a rapid growth in demand for natural and naturally derived products and ingredients due to awareness of environmental issues and to cater for the ever increasing number of Muslim population in UK, responding to the growing demand and 3
the „cultural catering‟ trend, speciality retailers and mainstream supermarket are expected to devoting more shelf space to market halal cosmetic and toiletries. Malaysia is the world‟s largest producer of palm oil and palm-based oleo chemicals is of vegetarian origin. It is koser and halal and does not offend any religious groups. The application of pal kernel oils and palm kernel based oleo chemicals are varied to food application, personal care and cosmetic application to industrial application. For personal care it could be used for skincare, body care, hair care, oral hygiene, toiletries, make-up cosmetics, perfumes and fragrances. Malaysia could be the leader in supplying the needs of UK Muslim consumers.
Some of the big corporate names in UK are already recognising the vast market of the halal financial market. In Britain, Llyods TSB is another latest bank to introduce Islamic Banking services, following the establishment of the first Islamic Banking of Britain Plc in UK. GlaxoSmithKline, one of the biggest pharmaceutical companies, is working together with Britain‟s Muslim Law Council, to recognise the company‟s Ribena and Lucozade soft drinks are Halal, or in conformance with Muslim dietary law.
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Market Acess/ Regulatiions/Restriction
The UK Halal Foods market is predominantly associated with the supply and provision of meat, meat products and poultry to cater for UK Muslim population. Packaged or tinned meat or chickens are included in this category. For Malaysian suppliers, access to this market is completely restricted as a result of the current regulations imposed by the Ministry of Agriculture, Fisheries and Food (MAFF) regarding Malaysian meat products. According to MAFF the importation of meat products into Great Britain must originate in a country which appears on the „third country list‟ and must be produced in plant approved to export the European Union. Council Decision 78/542/EEC draws up a list of third countries from which Member States authorise imports of bovine animals, swine, equidae, sheeps and goats, fresh meat and meat products. Currently Malaysia does not appear on the approved EU list and therefore meat products imported into Great Britain from Malaysia could not be used for human consumption. It also be noted that products which contain less than 5% meat are still considered to be meat product, and as such same rules apply as above.
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The ruling by the EU would automatically disqualify any Halal or non-Halal products containing meat from Malaysia to be sold in UK, even if the meat content is less than 5%. Apart from food products containing meat, the importation into the UK of Halal or non-Halal foods will be regulated under the Imported Food Regulations 1997. The Regulations cover the import of food of non-animal origin. A health certificate is generally not required for the import of non-animal origin. The Regulations require the food being imported from outside the European Union must meet the food safety requirements of the Food Safety Act 1990. In general these are that food must not be: Rendered injurious to health, Unfit for human consumption, So contaminated that it is not reasonable to expect it to be used for human consumption in that state. The Imported Food Regulations also require that imported food must not be unsound or unwholesome. Port Health Inspectors have powers to examine, take samples and detain consignment of imported food if they suspect it is in breach of food legislation.
Cosmetic and Toiletries In UK, the safety of cosmetic products is regulated by the Cosmetics Directive, which is implemented in the UK by the Cosmetic Products (Safety) Regulations. This legislation requires any cosmetic product placed on the market to be safe under normal circumstances of use. A safety assessment must be carried out by the company responsible through a professionally qualified safety assessor for each cosmetic product marketed. This is based on knowledge of the finished product and its ingredients and the assessment is open to inspection by the competent authorities. In addition, further control is exerted through a list of substances that are prohibited from cosmetics and another list of ingredients that are allowed only when complying with specific restrictions. Where appropriate, there are mandatory warning notices. Certain categories of ingredients (preservatives, UV filters and colorants) may be used only when they have been approved and are listed in the Cosmetics Directive (the so called “positive lists”).
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Labelling, Packaging and Endorsement
o The labelling of most food in Great Britain is governed by the provisions of The Food Labelling Regulations 1996. These regulations lay down detailed requirements for the labelling of most foods including a precise name for the food, a list of ingredients, an appropriate date mark, expiry date, the name and address of the packer, manufacturer or EC seller and in certain circumstances, any special conditions of storage, use, or place of origin. All information presented on a food label is subject to section 15 of The Food safety Act 1990 which makes it an offence to describe a food falsely or label in such a way as to mislead as to its nature, substance or quality. In UK, enforcement of food law is the responsibility of local food authorities that will liase with the local Port Health Authority, the Trading Standards or Environmental Health Department. o For Halal food products the labelling of the products as Halal is of course crucial for its acceptance by the UK Muslim population. Majority of the Muslim community are quite liberal and receptive in accepting the Halal logo from other countries such as Malaysia. UK Muslim population is however aware that there are bogus Halal certification being done in UK and there are also people writing Halal in Arabic which have managed to mislead a lot of Muslim in believing the products are Halal. It is therefore to the benefit of the Malaysian manufacturers to liase or co-ordinate with reputable authority such as the UK Halal Food Authority (HFA) or The Halal Monitoring Committee, with a view to have their products approved and endorsed to enhance acceptance into the UK Halal market. HFA is a UK recognised authority on Halal and is a voluntary, non-profit making organisation launched in 1994 to monitor and regulate Halal foods in UK. The HFA introduced a unique system of identifying halal meat from non halal and is also assiduously engaged in regulating, endorsing and authenticating food stuffs, pharmaceuticals, confectionery, toiletries, flavouring, emulsifiers, colourings (including E numbered additives etc) for Muslim usage. o Halal Monitoring Committee was recently formed to implement, facilitate and create a clear-cut reliable certification procedure and to establish a unified central certification board in UK. A steering committee was formed in order to serve the Muslim Ummah. An initial committee of eminent personnel comprising of Scholars (Ulama) and professionals from within U.K. was set up in order to oversee, recommend and implement the Shari'ah requirements of Halal meat supply.
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Distribution Channels
For Halal meat and poultry, the traditional specialised Halal butchery shops are the main distribution channels. These butchers are located all over UK, with high concentration in areas predominantly populated by the Muslim ethnic groups. Apart from meat and poultry, these shops also sell other halal food products and spices.
Cultural catering is now the main theme in retailing in UK and the mainstream supermarkets are aware of the vast opportunity in catering for the local needs. TESCO is already taking the lead as a leader in catering for the Muslim population by opening a Halal meat centre within its supermarkets and this trend is expected to be popular with other big supermarket eager to provide for the ethnic catchments areas. However, generally the distribution of Halal foods products is still very fragmented in terms of supply. The supply and distribution is still predominantly controlled by a small number of specialist distributors serving specialised retail base (often small, family-run business) that are based in ethnic areas specifically to cater for their local communities‟ needs. Overseas brands tend to appoint agents and brokers for their products in the UK. There are several specialist wholesalers involved in the sector. For example, JK Foods is a leading supplier of Asian products (Halal and non-Halal), with a cash and carry and depot in the Midlands. For Malaysian Halal food products, the main distributors (non-specialist) are the oriental supermarkets such as Wing Yip, Oriental City Supermarket, Hoo Hing Limited, New Loon Moon Supermarkets Limited, Tung Hing Oriental Supermarket and Chadha Oriental Foods Limited. Typical food products sold through these outlets are Halal noodles, Halal ready-made sauces, Halal confectionery, Halal tinned foods, Halal soups in packets, Halal burgers and sausages. Roti Paratha from Malaysia is also popular stocks for local corner shops, especially with those Halal butchery shops. Mainstream supermarkets are now responding to the UK‟s ethnic diversity by opening a section dedicated to Halal product, especially in ethnically diverse store catchments. The products are however restricted to fresh meat and poultry and meat products such as Halal beef burgers, sausages, samosa and canned foods. The products are mainly the produce of Turkey but manufactured, packaged and distributed by a distributor based in Holland under the brand name TAHIRA which have an office in Holland and Germany. The labelling on these products states that the products have been processed and pack under strict supervision of the World Islamic Foundations. 7
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Opportunities for Malaysian PRODUCTS
There is good opportunity to penetrate the UK halal market with its ever increasing number of Muslim population. The move by the mainstream supermarkets to ethnic catering is positive sign that the market is there to tap and soon will be main focus of the big superstores/supermarket shelves instead of restricted to specialised small retailers and „corner‟ shops. The non-existence of a recognised single body to oversee the certification of halal is an added advantage for Malaysian certified halal products, especially if Malaysia is successful in promoting the MS 1500 as an international standard. The acceptance amongst UK Muslim consumers of JAKIM halal logo is also added advantage to the promotion of Malaysian halal products in the UK. The strict regulation concerning meat and meat based products from Malaysia means that there is no prospect at all for Malaysian Halal meat products to penetrate UK market and this sector represents the large slice of the Halal food markets. However, there are other segments of the market that will provide ample opportunities for Malaysian manufactures. These are: Halal ready-made sauces (without meat contents). Halal confectionery Distribution of Halal nutrients, vitamins and minerals. Halal toiletries and cosmetics (some well-known brands of soaps and toothpaste are in the list of Harram items). Supplying variety of Halal extracts, flavouring, emulsifiers and colouring to local manufacturers catering for Halal foods. Supplying manufacturers of Halal fats, edible oils and lipids for foods and the pharmaceutical industries. Manufacturing or supplying Halal E467, E471, E472a, E472e, E481 and E482.
For food products, Malaysian suppliers must identify halal food products that can be marketed in UK, taking into account the need and taste of the local ethnic Muslim consumers. Muslim community in UK is of diverse origins thus tastes and preferences are also wide ranging.
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Cosmetic and Toiletries In UK, the emergence of wellbeing trend which favours the use of natural ingredients could spark off the interest in halal cosmetics and toiletries. The toiletry and skincare industry with health conscious consumers concerned by the use of high levels of preservatives that is toxic and damaging. Halal products are seen as natural and contain no unwanted chemicals and Malaysian halal products should be marketed as such on line with the current market trends of consumer demands in UK. Malaysia is the world‟s largest producer of palm oil and palmbased oleo chemicals is of vegetarian origin. It is koser and halal and does not offend any religious groups. The application of pal kernel oils and palm kernel based oleo chemicals are varied to food application, personal care and cosmetic application to industrial application. For personal care it could be used for skincare, body care, hair care, oral hygiene, toiletries, make-up cosmetics, perfumes and fragrances. Soaps that are bought in UK are made from a composite of animal fats of which the largest percentage is usually that derived from swine (pork) sources. For the Muslims community, availability of HALAL GELATIN is also a very sensitive issue to ensure the consumption of genuinely Halal quality products. Gelatine are used in a variety of industrial applications especially those elated to food processing, pharmaceuticals, cosmetics and toiletries, photography, printing and many more and obvious alternative for the Muslim consumers are palm oil based ingredients. Malaysia could be the leader in supplying the needs of UK Muslim consumers. In recent years, the personal care industry has witnessed a rapid growth in demand for natural and naturally derived products and ingredients due to awareness of environmental issues and to cater for the ever increasing number of Muslim population in UK, responding to the growing demand, speciality retailer are devoting more shelf space to market halal cosmetic and toiletries.
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SERVICES Muslims in the U.K. for many years have been expressing deep concerns as to the authenticity of Halal meat and poultry supplies. There are currently many such suppliers, but unfortunately the certification procedure and the verification of these certificates have had many flaws. These flaws have created many doubts in the minds of many Muslims, and our trust in the authenticity of our meats being Halal was put to question. UK Halal meat and poultry also face contamination issues e.g. Supplies from Holland etc. Malaysia International Image is that of modern, progressive Muslim nation and Malaysia halal logo and certification system is well recognised in the UK. There is no single body in the UK that is officially recognised for Halal certification purposes. UK Muslim population is aware that there are bogus Halal certification being done in UK and there are also people writing Halal in Arabic which have managed to mislead a lot of Muslim in believing the products are Halal. JAKIM could explore the possibility of offering their expertise to the UK body such the UK Halal Food Authority (HFA) in the certification process. HFA is a UK recognised authority on Halal and is a voluntary, non-profit making organisation launched in 1994 to monitor and regulate Halal foods in UK. Halal Monitoring Committee is another body that JAKIM could be working with to promote its services in UK. The Halal Monitoring Committee is a non-profit making organisation which does not side with any one particular masjid, but rather is a universal service, which seeks to obtain self sufficiency (i.e. not remain dependant on donations for its continuation) and also to represent all the different schools of thought within Islam. The Halal Monitoring Committee aims to regulate, and at every point inspect consumables from their sources, to the consumer. This will be done by means of thorough inspections, unannounced checks and the labelling of these consumables, which are to be continuously monitored by qualified inspectors. This method will be effective and efficient as well as low cost.
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Conclusion The ever growing Muslim population in the UK, particularly with strong population growth from the second generation Muslims from Asia, Middle East provides lucrative market for Halal products in the marketplace. The setting up of Islamic Bank in Britain last year is another testimony on the seriousness of the Government to cater to the market demand. In terms of purchasing power, the Muslim community is indeed a force to reckon with, where these second generation Muslim population are already entering the UK workforce. If we look at the weekly shopping cart or consumption of a typical Muslim family in the UK, 30 percent of the budget allocation would easily go to sourcing of the halal food. Although the prohibition to export meat or meat based from Malaysia to the UK prevails, items such as snacks food, confectionery, gelatine and other non meat based products are highly demanded. Malaysia also has a lot of expertise in the Islamic banking and Insurance, as well as the certification of Halal marking. Mutually beneficial collaboration with the relevant authority could be further explored. Halal certification from Malaysia is very well recognised and acceptable in the UK.
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Exhibition Name: Venue: Date: Organiser: Hotelympia Excel, London 19-23 February 2006 Fresh RM Tel: 020 7886 3066 Fax: 020 7886 3091 Website: www.hotelympia.com
Name: IFE (International Food & Drink Exhibition) Venue: ExCel, London Date: 18 - 21 March 2007 Organiser: Fresh RM 020 7886 3100 Fax: 020 7886 3091 www Name: World Food Market – The Halal Exhibition Venue: ExCel London Date: 15-16 November 2006 Organiser: World Food Market Show Contact Person: Katharine Mann Tel: 020 8232 1600 Email: kmann@wfmlondon.com 11
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Useful contacts The Halal Food Authority 109 Fulham Palace Road LondonW6 8JA Tel: 020 8563 1994 Fax: 020 8563 1993 Email: info@halalfoodauthority.co.uk Website: www.halalfoodauthority.com
Halal Monitoring Committee 70 Baggrave Street Leicester LE5 3QS UK Tel: 0870 240 7267 Fax: 0116 251 5450 Email: info@halalmc.org Web: www.halalmc.org
Department for Environment, Food & Rural Affairs (DEFRA) Nobel House 17 Smith Square London SW1P 3JP Tel: 020 7238 6000 The Helpline email address is: helpline@defra.gsi.gov.uk Food Labelling & Standards Division Food Standard Agency Room 115B Aviation House 125 Kingsway London WC2B 6NH Tel: 020 7276 8143 Fax: 020 7276 8193
MATRADE LONDON January 2006 12