Insight and opinion from The National’s editorial leadership
February 21, 2024
Around a trillion dollars’ worth of food is thought to be discarded each year. The culture of profligacy is both shocking and concerning, but perhaps not surprising, considering millennials and their generational predecessors were born into a world of cheap food. In the last quarter of the 20th century, global food prices fell by 75 per cent.
Times have changed, even if humanity’s relationship with food is slower to do so. Since the mid-2000s, food prices have climbed to dizzying heights. The Covid-19 pandemic, the war in Ukraine and accelerated climate change have compounded the challenges. Global prices have settled somewhat in recent months, according to the UN Food and Agricultural Organisation’s food index, but in the Middle East, renewed conflict has braced people for the worst.
This week at Gulfood, an annual trade show in Dubai for the food and beverage industry, UAE supermarket bosses told The National that while they are doing their best to keep prices stable for consumers, geopolitical shocks are rendering it a struggle. These sentiments are echoed across the Middle East, and in lower income countries they are even more pronounced. The proximate source of fears is Israel’s continued war in Gaza and the subsequent attacks on commercial vessels in the Red Sea by Yemen’s Houthi rebel group.
These conflicts show little sign of slowing down. On Monday, the Houthis attacked a UK-registered and Lebanese-operated cargo vessel, forcing its crew to abandon ship.
The Middle East is particularly reliant on shipping lanes, with the region as a whole importing the majority of its food. Some markets, such as the GCC, import as much as 85 per cent.
“There is already an impact in terms of supply, cost and availability,” said Rajiv Warrier, chief executive of the multinational supermarket chain Choithrams. Mr Warrier anticipates that prolonged disturbances to Red Sea shipping could result in GCC food prices rising by the second half of 2024, with a corresponding impact on general inflation.
The Middle East is particularly reliant on shipping lanes, with the region as a whole importing the majority of its food
Not all of the region’s food depends on Red Sea passage, but the effects of Houthi attacks reach into other shipping routes, too. Lulu Group, one of the Middle East’s largest supermarket chains, has sourcing offices across China and South-east Asia that can supply food using the Indian Ocean. But as a greater number of shipping firms divert their vessels from the Red Sea, insurance costs and other overheads rise for everyone. Flying food in is among the least preferable options, but it has become more common.
The Middle East is already among the world’s most price-sensitive regions. For its poorest, every percentage point increase in the price of food can have dire consequences. The World Bank cites “mounting evidence that negative [price] shocks can have multi-generational effects on development outcomes in education, health and income”, pushing the most vulnerable deeper into a poverty trap. The rise in prices caused by the Ukraine war in 2022, the World Bank says, may have even stunted the development of up to 285,000 babies in the Mena region.
Even if the Gaza war is resolved and the Houthis cease their campaign in the Red Sea, it will be some time before the world can hope for a return to “cheap food”. Some economists warn that, in a world getting warmer ever year, it may never happen. But whatever the long-term trend turns out to be, there is little doubt that some of the worst damage is being done by short-term shocks that could – with enough political will – be avoided.
It's up to you to go green
Nils El Accad, chief executive and owner of Organic Foods and Café, says going green is about “lifestyle and attitude” rather than a “money change”; people need to plan ahead to fill water bottles in advance and take their own bags to the supermarket, he says.
“People always want someone else to do the work; it doesn’t work like that,” he adds. “The first step: you have to consciously make that decision and change.”
When he gets a takeaway, says Mr El Accad, he takes his own glass jars instead of accepting disposable aluminium containers, paper napkins and plastic tubs, cutlery and bags from restaurants.
He also plants his own crops and herbs at home and at the Sheikh Zayed store, from basil and rosemary to beans, squashes and papayas. “If you’re going to water anything, better it be tomatoes and cucumbers, something edible, than grass,” he says.
“All this throwaway plastic - cups, bottles, forks - has to go first,” says Mr El Accad, who has banned all disposable straws, whether plastic or even paper, from the café chain.
One of the latest changes he has implemented at his stores is to offer refills of liquid laundry detergent, to save plastic. The two brands Organic Foods stocks, Organic Larder and Sonnett, are both “triple-certified - you could eat the product”.
The Organic Larder detergent will soon be delivered in 200-litre metal oil drums before being decanted into 20-litre containers in-store.
Customers can refill their bottles at least 30 times before they start to degrade, he says. Organic Larder costs Dh35.75 for one litre and Dh62 for 2.75 litres and refills will cost 15 to 20 per cent less, Mr El Accad says.
But while there are savings to be had, going green tends to come with upfront costs and extra work and planning. Are we ready to refill bottles rather than throw them away? “You have to change,” says Mr El Accad. “I can only make it available.”
Know your Camel lingo
The bairaq is a competition for the best herd of 50 camels, named for the banner its winner takes home
Namoos - a word of congratulations reserved for falconry competitions, camel races and camel pageants. It best translates as 'the pride of victory' - and for competitors, it is priceless
Islay Robinson, group chief executive of mortgage broker Enness Global, offers his advice on buying property in today's market.
While many have been quick to call a market collapse, this simply isn’t what we’re seeing on the ground. Many pockets of the global property market, including London and the UAE, continue to be compelling locations to invest in real estate.
While an air of uncertainty remains, the outlook is far better than anyone could have predicted. However, it is still important to consider the wider threat posed by Covid-19 when buying bricks and mortar.
Anything with outside space, gardens and private entrances is a must and these property features will see your investment keep its value should the pandemic drag on. In contrast, flats and particularly high-rise developments are falling in popularity and investors should avoid them at all costs.
Attractive investment property can be hard to find amid strong demand and heightened buyer activity. When you do find one, be prepared to move hard and fast to secure it. If you have your finances in order, this shouldn’t be an issue.
Lenders continue to lend and rates remain at an all-time low, so utilise this. There is no point in tying up cash when you can keep this liquidity to maximise other opportunities.
Keep your head and, as always when investing, take the long-term view. External factors such as coronavirus or Brexit will present challenges in the short-term, but the long-term outlook remains strong.
Finally, keep an eye on your currency. Whenever currency fluctuations favour foreign buyers, you can bet that demand will increase, as they act to secure what is essentially a discounted property.
