Gulfood: Global cost of living crisis making people more discerning about what they buy

Consumers are happy to pay more for healthy and nutritious products, experts at opening day of trade show say

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People are happy to pay more for food as long it's healthy and nutritious, despite the cost of living crisis, industry experts have said.

While the cost of living has risen, causing food prices to increase, consumers will pay extra as long as they know they are getting healthy food.

The National spoke to experts on the opening day of the Gulfood trade show at Dubai’s World Trade Centre.

One of the trends emerging was consumers buying less than before but spending more to ensure it is the right food — a classic case of quality not quantity.

“People are looking for better food than before, despite the fact costs are rising,” said Kieran Fitzgerald, regional director in Mena for Bord Bia (the Irish food board).

“We are noticing, from talking to customers, that while shopping basket value and size is dropping, people are going for higher value products.

“Globally we’ve seen that people are changing how they are consuming. They are going out to restaurants less, but we’ve seen they are buying higher quality products from retailers.”

A recent report from YouGov, which was published earlier this month, showed two-fifths of UAE residents said their disposable income had decreased over the past year.

The study, which covered almost 20,000 people across 18 different countries, showed the UK had the highest number of respondents whose income had decreased in the past 12 months (64 per cent).

Almost a third of respondents in the UAE (31 per cent) said they planned to regularly save money over the next year.

Learning to better manage money was the top response (34 per cent) when UAE residents were asked what they needed to improve their financial situation.

This was just ahead of understanding investments and making a budget, which both were listed by 30 per cent of respondents.

'Nutritional content of food is vital'

The habits of consumers in the UAE have changed in recent years, according to Mr Fitzgerald.

“Research we’ve conducted shows the majority of adults now believe the nutritional content of food is vital,” he said.

“The environmental impact, food safety and traceability are also priorities for people when they are deciding what food to buy.”

He also said the Middle Eastern market is a key region for the Irish, especially after Brexit.

“The UK has traditionally been our biggest market but Brexit has taught us a lot about a dependence on just one market,” he said.

“We’ve learnt it’s important to differentiate your markets. The Middle East is an important growth market to us.

“It was worth €364 million to us last year, that figure was only a couple of million euros as recently as 15 or 20 years ago.”

Another expert said there was a clear trend in the UAE of people moving towards healthy and nutritious options when it came to eating preferences.

“A wide variety of people are looking to cook at home now and want to know about the nutritional value of what they are cooking,” said Mark Casey, general manager of trade strategy and stakeholder affairs for Fonterra, a New Zealand firm specialising in dairy products.

“We’re seeing a trend where people are trying to find out more about the nutritional value of what they are eating and that’s because they want their dirhams to go a bit further.”

He said he doubted food prices would stop going up any time soon.

“It’s only going to keep rising, due to the cost pressures on the food chain,” he said.

“I don’t think those pressures are coming off anytime soon when it comes to food.

“The price increases are here to stay. If you look at other areas like fuel prices, they came down a little bit (since the cost of living crisis began) but food prices have not.”

The food market is largely protected by the fact people need to eat, said another industry expert at Gulfood.

“People can’t just stop buying food. We have noticed they are saving expenses by spending less on leisure activities or are eating at home and going out less,” said Michael Nail, export sales manager for French cooking oil firm Lesieur.

“People began cooking at home a lot more during Covid-19 and that’s something we are still seeing.”

Updated: February 20, 2023, 3:30 PM