Bahrain’s Food Industry Is Poised For Growth

rate of 3.6% per year

The 2021 Food and Drink Report by Fitch

Solutions predicts an optimistic outlook for Bahrain’s food industry for the next three years. Key driving factors for the projected growth include growth in the key buying age segment and rising levels of private final consumption and household spending. The Kingdom’s relatively wealthy population means that food consumption is already high and there is diversification in the diets of citizens. Consumer spending patterns are expected to remain favourable over the coming years.

Opportunities For Growth

The report highlights some key investment opportunities:

Investment in Bahrain’s transport infrastructure and location is likely to lead to growth in logistics, which could benefit food manufacturers and lead to a rise in spending on food and drinks.

The tourism market is projected to grow as strong efforts are being made to draw in international visitors from the Middle East, North Africa and Asia Pacific regions.

Premiumisation will become a noteworthy driver of growth due to high per capita incomes and the sizeable number of expatriates. More premium restaurants with diversified menus are likely to open to cater to an increased numbers of tourists and expats.

FAST-GROWING CATEGORIES

The meat and poultry category is expected to perform strongly and grow by an annual average of 3.5% due to a growing demand for protein, which forms a big part of many Bahrainis diets.

Furthermore, the rising number of fine dining and fast food outlets is contributing to the increased demand for meat and poultry.

Dairy sales are predicted to grow by an annual average 4.2% through to 2025. Vegetable sales are growing substantially, averaging 4.9% growth per year over the next three years.

Significant Findings

As a proportion of total household budgets, the average Bahrain-based household is forecast to spend 12.9% on food by 2025, a decline from 14.2% in 2005.

Bahrain’s small population, which is forecast to reach 1.87million in 2025 (making it the smallest GCC country), coupled with a modest share of food spending within total household budgets, means total food spending is low by regional and international standards.

Total food spending is predicted to reach US$1.2billion (BHD457.8mn) in 2025, compared to US$21.7billion in the UAE and US$5.9billion in Qatar. The largest proportion of food spending in Bahrain goes towards meats and poultry, accounting for nearly a fifth of total food spending. This category will see its share increase over 2021-2025 period.

For more information about the 2021 Food & Drink Report, visit: www.fitchsolutions.com