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UAE supermarkets are turning to alternative import routes by land, air and sea to keep food prices under control and shelves fully stocked as the closure of the Strait of Hormuz causes supply challenges.
Spinneys, which operates more than 75 stores in the Emirates and Oman, said it had been able to “keep a lid on inflation” due to its focus on locally produced goods.
Tom Harvey, general commercial manager at Spinneys, said the retailer is exploring a number of supply routes – including transporting goods by road from London to Dubai.
“Because of the amount of food that we import and control ourselves we've been very much able to keep a lid on inflation,” Mr Harvey told The National.
“Clearly the situation is changing. There are increased costs going on with containers, the war surcharges, increased insurance, and the additional costs of moving containers across from other ports by road, so there will be some inflation.
general commercial manager, Spinneys
“It's something that we're continuing to monitor on a day-to-day basis, and there probably will be some goods that move up faster than others.
Mr Harvey said the chain had not been passing on additional transport costs to customers but this would be subject to review.
“Depending on how long things go on, we will have to review and, assess that, but we've got great availability on the shelves,” he said.
Well-stocked
The government has a reserve of four-to-six months' worth of essential goods that can be used, Abdulla bin Touq, Minister of Economy and Tourism, said this month.
“It's important to make sure that everybody in our, in our community is reassured that there are no issues in terms of making sure we've got good availability of food.”
Mr Harvey said Spinneys is considering a number of supply routes to keep business operations running smoothly in challenging times.
“We’re exploring a number of different supply routes and the green corridor now opened up from Oman.
“We're bringing boats into Khor Fakkan and then bringing goods by road from there, and we are also exploring other routes.
“We’re going to be bringing some products down through the Red Sea to Jeddah, and we will then truck from there, and we are very actively exploring the possibility of actually doing road freight from Europe.
“It's a 7,000km road trip from London to Dubai, and that will take us about 15 days to bring some goods in.
“What we're doing now is getting some trucks to our warehouse just outside of London, we'll stick it on the ferry over to France and be keeping an eye out for it to arrive a couple of weeks later in the UAE.”
Choithrams chief executive Mark Mortimer-Davies said shelves remain largely full with fresh and frozen produce.
Produce offloaded from ships in Oman or on the UAE's eastern coast now cost between 7 and 20 per cent more owing to a “war surcharge” related to higher insurance for shipping firms, he said.
Then, goods must be brought over land to Abu Dhabi and Dubai. “We're trying to manage it as best we can, but there's obviously pressure,” he told Dubai Eye radio's Business Breakfast show.
Choithrams, which has more than 50 shops in the Emirates, has between four and eight weeks of supplies on hand.
“We've changed [supplier] countries, we're sharing shipments with other retailers. We're looking at every way we can to get volumes up and keep costs manageable,” Mr Mortimer-Davies said.
Major retailer Lulu has already taken steps to bolster food supplies by arranging special chartered cargo flights bringing essential goods from India and other key global sourcing markets.
A cargo freighter flight operated by Etihad Airways, Abu Dhabi this month brought about 80,000 kilograms of fresh produce from India to Abu Dhabi.
Mood in the market
When The National visited the fruit and vegetable market at Abu Dhabi's Mina Zayed on Tuesday, business was brisk but traders had concerns.
The lack of Iranian imports, they said, had led to an increase in prices due to the scarcity of supply.
One seller said that he hoped Iranian produce would arrive on Wednesday by boat, helping to bring down prices.
Tomatoes, typically Dh3 per kilo from Iran, are among the items affected. Locally grown UAE tomatoes were being sold for between Dh5 and Dh8 per kilo.
Delivery disruption
The knock-on effect of war has been felt across the Middle East’s supply chain.
One of the major logistics firms affected is DHL, which operates a diverse network, including its own aircraft fleet and dedicated air freight services to and from the GCC.
Using alternative gateways of Oman and Saudi Arabia has allowed the company to keep disruption to a minimum.
Despite that, some additional charges have been passed on to customers receiving deliveries in the UAE.
“The specific impact and commercial conditions vary significantly depending on a range of factors, such as routing, mode of transport, service level and timing,” said Tobias Maier, chief executive of DHL Global Forwarding Middle East and Africa, who is based in Dubai.
“DHL works closely and transparently with customers to identify the most appropriate solutions for their individual consignments, and customers are proactively informed where shipments are affected.
“It is too early to predict timelines as the situation remains highly dynamic.
“Any normalisation will depend on the full re‑opening of airspaces and maritime routes, as well as broader operational conditions stabilising.”
Moving costs
Clare McIntyre, owner of MacPack Removals, said 80 per cent of those inquiring about relocation costs were already planning to leave the UAE before the outbreak of war.
“This has been a very strong catalyst for them to get organised, while the other 20 per cent were people who wanted to know what would happen under different scenarios,” she said.
“At present, due to the situation, the full cost implications of shipping are still unclear.
“Shipping lines have not released updated schedules or freight rates, but we expect them to increase, and additional war risk surcharges to be applied.”
Security risk
Red Sea security risks saw the Suez Canal reduce its marine operations in 2023, with tanker traffic only just returning in 2026.
Pushing vessels around southern Africa’s Cape of Good Hope doubled transit times, with that route likely to become more common for tankers seeking to avoid re-emerging Middle East conflict zones.
“For vessels coming through the Mediterranean and then Suez, we were looking at about six weeks door-to-door from the UK for household goods,” said Ms McIntyre, who manages storage centres near Jebel Ali.
“If ships go around the coast of Africa, door-to-door times are realistically more like 12 weeks.
“We’ve been told that our packaging costs will increase, and fuel prices no doubt will go up which will obviously impact us.”
