The global halal food and beverages market is one of the fastest emerging consumer segments in the world. The Muslim population is the 2nd largest religion in the world and is the fastest-growing religion in the world. As per the research done by Bonafide Research in their report titled- Global Halal Food and Beverage Market Outlook, 2026, Bonafide Research has identified different forces influencing the halal foods and beverages market the world over and has discussed the challenges faced by the industry. As per the data collated by Bonafide Research, the halal market globally grew by USD 412 Billion during the historical period of 2015 to 2020. It has been forecasted that halal food and beverages will continue a strong growth momentum and by 2026 growing at a CAGR of more than 7% during the forecast period of 2020 – 2026 to push the market size beyond a double trillion figure.
The OIC is at the center of the international trade of halal foods and beverages. However interestingly the some of the biggest exporters of halal foods and beverages are Non-Islamic countries. To maintain the integrity of halal, the importing Islamic countries have different rules and standards on certification of halal foods and beverages. The problem lies in the fact that as there are different standards and certifications for different Islamic countries, the exporters have to navigate through a heavy regulatory framework to identify multiple certifications in order to target the right market. Over the past few years, the unification of halal standards has been a major topic for discussion in the halal economy and the necessity to do so has been realized in order to promote the global halal food and beverages market.
As per data revealed by Arabian Business, sourced from State of the Global Islamic Economy Report 2020/2021 approximately 40% of all food and beverages consumed by Muslims worldwide are not authentically certified as Halal. This shows the significant need for filling the necessary gaps in the halal food and beverages market. To lay a base for comparison, consider the Kosher market. The global Kosher foods and beverages market is valued at USD 25 Billion according to Arabian Business catering to a Jewish community of approximately 15 Million people. The Kosher market includes matured players such as Empire and Kayo which have over USD 100 Million in annual revenue as compared to a very highly fragmented halal food and beverages market where 1.8 Billion Muslims are reliant on small-scale producers. The industry needs consolidation in order to ensure efficiency and effectiveness in the entire halal supply chain. However, the flow of capital is also limited in the market. During the period of 2018-2019, about USD 343 Billion was invested in annual mergers and acquisitions activity in the global foods and beverages industry in 2018-19 of which halal accounted for a tiny portion of just USD 0.6 Billion as per Arabian Business.
These gaps in the supply chain also translate into mistrust and lack of confidence among consumers in halal labelling on the products. Especially in regions like Europe, North America, Latin America where the Muslim population is in minority and Christianity is a major religion being followed, halal rules are not applicable to other religions. There is a lack of transparency as to how the halal food and beverages are sourced and processed and if all the risk of contamination has been checked.