SINOQUAL at the 2014 FIA International Halal Forum - Republished by Many News Sites

After SINOQUAL's 2014 FIA International Halal Forum was featured on the front page of China Pharmaceutical News, it was immediately republished by many news sites:

Broad Prospects for Halal Food Exports

According to the 2009 global census, the world's population was 6.8 billion, of which the Muslim population was 1.57 billion, accounting for 23.4% of the world's population, distributed across more than 200 countries and regions and growing rapidly. According to Islamic religious rules, Muslims' food must be Halal, which brings a huge and growing demand for Halal food. It is understood that the annual market value of Halal food worldwide has exceeded US$650 billion and is growing rapidly as the population increases.

Such a market with enormous potential has attracted the eager attention of Halal food producers from around the world. However, this market is currently firmly held by countries such as Brazil and Australia, with China accounting for only a tiny 0.14% share. Recently, at the 16th 'Food Ingredients Asia 2014' held in Shanghai, how Chinese food enterprises can open up the global Halal food market became a topic of concern for many enterprises.

Stepping onto the International Stage Through Certification

When it comes to Halal food, people usually first think of the fragrant lamb skewers or hand-pulled noodles on the streets, or of instant-boiled mutton enjoyed around a stove with family and friends in the depths of winter... In fact, Halal food has extremely strict definitions, and Islam has made detailed regulations for Halal food and ingredients. Information shows that Halal food is 'lawful, clean and wholesome food prescribed by a series of Islamic dietary laws,' and must not contain blood, alcohol, narcotics, etc.

'In other words, Halal food is actually defined as absolutely safe, containing no non-Halal food or ingredients and raw materials harmful to health, and the equipment used in processing and manufacturing is not allowed to contain non-Halal ingredients,' introduced Tessie Young, General Manager of Shenzhen SINOQUAL Biotechnology Co., Ltd., China's first international official Halal certification body. The products of Halal food producers must meet Halal standards; all raw materials used in the production process must be Halal-certified; products or raw materials must be processed, produced and packaged under high cleanliness and hygiene standards; and if a product or raw material is contaminated or cross-contaminated with any non-Halal substance, it must absolutely not be used.

Therefore, domestic Halal food producers first face a mandatory threshold for entering the international market - Halal certification. Tessie Young explained that the current global certification brands include the Singapore government's MUIS-Halal certification, the Malaysian government's JAKIM-Halal, Indonesia's MUI Halal certification, and the United States' IFANCA Halal certification. Exporters should check with the importing country's government to clarify which bodies are recognized as organizations qualified to provide Halal certification for specific products.

It is not easy for an enterprise to pass Halal certification. According to the introduction, an applicant enterprise must pass a strict on-site production audit by a certification officer to obtain the qualification certification, only then can it get the 'pass' to export to the Halal market and use the Halal label on product packaging. Even after passing the audit, one cannot let down one's guard. 'An enterprise's internal management and integrity building are especially important for Halal food enterprises. For example, in Halal food, the content of additives such as flavors and fragrances must not exceed 0.5%, and alcohol may only be used for cleaning and disinfecting factory equipment. Therefore, when producing Halal food, enterprises need to bear in mind various prohibitions, especially not placing prohibited products together with Halal food to avoid cross-contamination. Once a product is found by the destination country to contain non-Halal food ingredients, alcohol, or excessive additives, it will be immediately rejected, causing large losses for the enterprise. In addition, once an enterprise commits a serious violation, it will be blacklisted by all Muslim markets,' Tessie Young cautioned.

A Vast Market with Enormous Potential

With many prohibitions on raw materials, the production process must also comply with all sorts of 'stringent' regulations and pass strict review and certification - it is not easy to become a Halal food enterprise. But the limitless business opportunities of Halal food make food manufacturers around the world eager. It is understood that the global Muslim population is mainly distributed in the Arab regions of the Middle East, Southeast Asia and Central Asia, with the most in Asia, and the potential of Halal food stems precisely from the rapidly growing Muslim population. 'At present, Halal food accounts for about 25% of the global food market, and is expected to reach 30% in the future,' Tessie Young introduced.

Information shows that Malaysia is the global leader in developing the Halal food industry and has raised standards to the highest level. In 2013, Malaysia exported Halal food worth US$9.8 billion, becoming one of the largest Halal food suppliers among members of the Organisation of Islamic Cooperation. After the 2008 financial crisis, Singapore became a bellwether of the global Halal product market, growing at 10% per year, with Halal food found throughout supermarkets and Halal restaurants increasing rapidly. US food manufacturers, such as Kellogg's and Hershey, also plan to build Halal food production plants following the Malaysian Halal food production model. And Indonesia, which has the world's largest Muslim population, plans to set up a Halal food production center in 2015. One-quarter of Thailand's food factories have already begun making Halal food. The Gulf countries of the Middle East, with scarce food resources and heavy reliance on imported food, have the world's largest Halal food market potential.

'The raw materials and ingredients used by Halal food enterprises can also be used by ordinary food enterprises, but the raw materials and ingredients of ordinary food cannot be used by Halal food enterprises. Therefore, if food ingredient producers successfully break into the Halal market, they can gain broader room for development through local food processing enterprises,' Tessie Young introduced.

In addition, in those countries where the Muslim population is the majority, the sales and industry of Halal food are rising steadily. Not only that, even in some countries where Muslims are not the majority, the food industry produces Halal food of enormous value. For example, in the United States, the total value of the Halal food market has reached US$20 billion. The Halal food market in Europe is also growing rapidly.

China's Unique Competitive Advantages

Since Southeast Asia is an important region where Muslims live, Halal certification bodies are also concentrated in Southeast Asia. 'In 2009 alone, MUIS provided Halal certification for 65 food enterprises, whereas previously there were only 5 each year,' introduced Nur Ruhaya, senior certifier at Singapore's MUIS-Warees.

'Another huge advantage is that, due to the signing of the Framework Agreement on Comprehensive Economic Cooperation between China and ASEAN and the completion of the China-ASEAN Free Trade Area, China's Halal food exports to ASEAN countries are subject to zero tariffs. This brings a price advantage for China's Halal food enterprises,' Nur Ruhaya said. On this, Tessie Young explained that currently the global Halal food market is held by countries such as Brazil and Australia, while China accounts for only 0.14%, a tiny share. But for those less economically developed Southeast Asian countries, due to lower purchasing power and inherent scarcity of resources, there is a large gap in Halal food demand; Brazil and Australia are too far away, while China has a natural geographical advantage with low transportation costs and a relative price advantage; combined with the zero-tariff policy, this series of favorable conditions will make China's Halal food very competitive in the ASEAN market.

And for wealthier countries such as Saudi Arabia, Dubai and Singapore, the successful export of Chinese Halal food can win handsome profits for enterprises. It is understood that yak beef from the Qinghai-Tibet Plateau, due to being purely natural, ecologically original, low in fat and high in protein, is very popular in Middle Eastern countries, with export prices reaching tens of thousands of yuan per kilogram.

(China Pharmaceutical News, by Lu Yue) Intern editor: Xiao Yi