The Halal industry goes beyond just what you eat; it’s a way of life covering everything from making food to buying it. This industry is booming worldwide. It’s expected that the global Halal market will grow by trillions in 2027, making it one of the world’s fastest-growing industries today.
In recent years, people worldwide have become more aware of sustainability, ethical shopping, green growth, and digital advancements, all of which have helped the Halal industry thrive across the globe.
What is Halal?
The term ‘Halal’ originates from Arabic, meaning “permissible” according to Islamic law, and it applies to pharmaceuticals, cosmetics, and food products. In Islamic communities, it signifies anything that complies with Islamic Syariah law, not just the ingredients but also the entire production and handling process from start to finish.
This includes marketing, manufacturing, supply, packaging, logistics, slaughtering, and more.
What is the Role of Halal Certification?
To be considered halal, a product must undergo certification from an authorized Halal certification body. Businesses looking to deal in halal food products must acquire the relevant certification from their country’s designated certification authority.
In Malaysia, this responsibility falls upon the Department of Islamic Development Malaysia (JAKIM), which assesses whether a product meets the halal criteria and issues certification as appropriate.
Obtaining halal certification goes beyond just using halal ingredients or following Islamic slaughtering methods. The halal assurance system is a comprehensive management system that covers all stages, including product development, procurement, production, quality control, and storage.
Key developments that are driving the industry
1. Rise of Transparency and Sustainability
Customers are becoming more conscious of the environmental effects of what they buy. They now seek products that are ethically made and have a minimal impact on the environment.
As a result, businesses have started to invest in transparent supply chains. This allows them to trace their products from the point of origin to the customer, ensuring that they can closely monitor the production process and maintain the quality of their products.
2. The Upsurge of Muslim-Friendly Tourism
Halal tourism is surging as a highly lucrative sector, with Muslim traveler spending projected to hit an astonishing $300 billion by 2026, as per a Mastercard-HalalTrip report.
This growth owes itself to multiple factors, encompassing the rise in Muslim tourists, evolving consumer preferences, and ethical considerations.
Moreover, affluent Muslim travelers’ increased demand for luxurious getaways is fostering opportunities for Halal-friendly accommodations worldwide, spanning the Middle East, Japan, Thailand, South Korea, and beyond. These venues provide tailored amenities like Halal dining, bidet-equipped restrooms, and prayer facilities.
Despite the pandemic disrupting the Halal food supply chain, it has also sparked novel prospects. Countries are striving for self-sufficiency in local food production to enhance security and innovation.
Meanwhile, the digital transformation driven by health-conscious Muslim consumers has boosted grocery e-commerce and home deliveries, propelling the rise of Halal food and grocery delivery services, including halal cloud or ghost kitchens. Global expansion endeavors have gained traction, with companies like Getir securing substantial funding.
3. Halal Food Appeals to Non-Muslim Consumers
The rise of ethical consumers has not only attracted Muslim consumers to halal brands and products but also non-Muslim consumers. Factors like concerns about diseases and food security have driven demand for healthier options, making halal products appealing to a wider audience.
Obtaining halal certification involves strict regulations, turning halal cuisine from a religious dietary choice into a symbol of safe, healthy, hygienic, and reliable food.
Numerous research studies indicate that non-Muslims hold a positive perception of halal food products and express a strong intent to purchase them because they recognize the rigorous processing standards associated with halal food.
4. Challenges the Industry Faces Moving Forward
As the industry expands, it faces challenges related to technology’s ability to keep pace with growing market demands and potential disruptions caused by climate change. Many OIC nations lack the necessary investment ecosystems to support the growth of technology startups.
While countries like the UAE and Malaysia can compete with the UK, France, and Germany in terms of technological innovation incubation, most OIC nations will need to allocate resources to develop mechanisms that can support the emergence of competitive food tech companies.
Another significant challenge for the industry is climate change, which has the potential to disrupt food production and interfere with domestic and international supply chains.
Factors such as the increasing demand for clean and reliable water sources, the potential for extreme weather events, and rising global temperatures must be considered by countries and organizations when developing halal food products and services.
In the coming years, the Halal industry is set to grow extensively with great possibilities. It’s not just about food; it covers everything from how things are made to how they’re used. The halal industry is known worldwide and is expected to be worth trillions more by 2027, making it one of the fastest-growing parts of the world.
Ori Bionature Sdn Bhd is an established contract manufacturer in Southeast Asia. We manufacture OEM dietary supplement products for numerous food supplement manufacturers across the world.