QATAR - FOOD & BEVERAGE SECTOR

OVERVIEW & FORECAST

THOUGHT LEADERSHIP SERIES

January 2019

Developed by D&B Qatar Research & Advisory Services team

 Executive Summary

Executive Summary
Total F&B demand is estimated to grow in line with population CAGR of 1.68% over the next 5 years to
reach USD 2.93 Bn by 2022

Macro economy of Qatar F&B sector in Qatar

Top 3 products by
demand Meat Dairy products Cereals

Nominal GDP Oil Share in GDP Ranked FIRST in Population F&B sector demand
(2017) 2014: 53% terms of GDP (2017) (2017) Top 3 exporters to
USD 167 Bn 2017: 33% per capita 2.7 Mn USD 2.7 Bn Qatar (2017) India Australia KSA
Key Growth

Substitution of imports from KSA

Drivers

Population of Qatar expected to International Tourist arrivals

grow at a CAGR of 1.7% to reach
3.3 Mn by 2030
and UAE, which used to account
estimated to increase at a CAGR
for major share of market in F&B
of 5% to reach 2.9 Mn by 2022
sector prior to blockade

F&B sector Forecast (USD Bn)

CAGR = 1.7%

2.74 2.78 2.83 2.88 2.93

2018(f) 2019(f) 2020(f) 2021(f) 2022(f)

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 Agenda

Agenda
Qatar - Strategic Overview

Food & Beverage Sector in Qatar

About D&B

3
 Qatar - Strategic Overview

Qatar - Population Demographics

Population in Qatar has doubled in the last 10 years to reach 2.6 Mn in 2017

Population in Qatar and Age Structure

Population in Qatar (Mn) Age structure (years)

1%
4%

2.64 14%
2.48 2.57
2.37
2.25
2.11
1.95 14%
1.78
1.59
1.39
1.19
67%

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 0-14 14-24 25-54 55-64 >65

◼ Qatar’s population has doubled in the past 10 years to reach 2.6 Mn in 2017, increasing at a CAGR of 8%
◼ ~70% of the population is in the working age group of 25-54 years (median age: 30)
◼ The United Nations Population division estimates that the population is expected to reach 3.23 million by 2030
◼ Administratively, Qatar is divided into eight (8) municipalities – Doha, Al-Daayen, Al Khor, Al Wakrah, Al Rayyan, Al
Sheehaniya, Al Shamal and Umm Slal (further divided into 92 zones), with a total area of ~11,586 sq. Km

Source(s): Ministry of Development Planning and Statistics, World Bank, United Nations

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 Qatar - Strategic Overview

Qatar - GDP and GDP Growth Rate

Qatar’s GDP has grown at a rate of 10% in 2016-17, after two years of decline owing to fall in global oil
prices; During this period, the share of hydrocarbon sector to GDP has reduced substantially
Nominal GDP (USD Bn) and Growth Rate (%), 2013-17 Contribution of Oil and non-oil sectors in GDP, 2014-17 (%)

250
10.0 15.0
10.0
Nominal GDP (USD Bn)

4.4

GDP Growth rate (%)

200 3.8
5.0 47.5%
61.4% 67.3%
0.0 69.7%
150
-6.2
-5.0
100 199 206
-10.0
162 152 167
-15.0 52.5%
50 -21.6 38.6%
30.3% 32.7%
-20.0

0 -25.0
2013 2014 2015 2016 2017 2014 2015 2016 2017
GDP (Current Prices) GDP Growth Rate (%) Share of non-oil sectors in GDP (%) Share of oil & gas sector in GDP (%)

◼ Qatar’s GDP grew at CAGR of 5.07% from USD 187 Bn in 2012 to USD 206 Bn in 2014, and then declined in 2015
and 2016 due to the fall in global oil prices.
◼ Strong recovery in global energy prices, aided by supply cut and rise in global demand, resulted in improved
domestic growth performance, with a nominal GDP growth rate of ~10% in 2016-17
◼ During this period, the share of Hydrocarbons in the GDP reduced from 52.5% in 2014 to 32.7% in 2017, which
shows the shift in focus of the Government to non-oil revenues
Source(s): Ministry of Development Planning and Statistics, Qatar Central Bank

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 Qatar - Strategic Overview

GDP of GCC nations

Qatar is the richest country in the world in terms of GDP per capita (PPP); It is the third largest country
in the GCC region, in terms of Nominal GDP
Nominal GDP (USD Bn) & GDP per Capita, PPP in 2017 (USD ‘000) - comparison with other GCC nations

800 Nominal GDP (USD Bn) GDP per Capita, PPP (USD '000) 140

GDP Per capita, PPP (USD ‘000)

700 120
Nominal GDP (USD Bn)

600 684 128 100

500 74 72 80
400
54 48 60
300 42
40
200 383
100 20
167 120 73 35
0 0
Saudi Arabia United Arab Emirates Qatar Kuwait Oman Bahrain

◼ Qatar is the third largest country in the GCC region, in terms of nominal GDP, behind Saudi Arabia and UAE
◼ However, in terms of per capita GDP (PPP), Qatar is the richest country in GCC and in the World. The five richest
countries in the world, in terms of GDP per capita in PPP terms, are Qatar, Macao, Luxembourg, Singapore and
Brunei Darussalam (2017)

Source(s): World Bank

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 Qatar - Strategic Overview

Qatar National Vision

Qatar National Vision, 2030 has been formulated based on four pillars: (a) Human Development,
(b) Social Development, (c) Economic Development and (d) Environmental Development
Qatar National Vision, 2030

◼ Qatar National Vision was formulated in 2008, which aims to transform Qatar into an advanced country by 2030,
capable of sustaining its own development and providing a high standard of living for its population and future
generations

Human Development Social Development

◼ Development of a just and caring society based on

◼ Development of Qatar’s residents and citizens to high moral standards, and capable of playing a
enable them to sustain a prosperous society significant role in the global partnership for
development

Economic Development Environmental Development

◼ Development of a competitive and diversified

◼ Management of the environment such that there is
economy capable of meeting the needs of, and
harmony between economic growth, social
securing a high standard of living for, all its people
development and environmental protection
for the present and for the future

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 Agenda

Agenda
Qatar - Strategic Overview

Food & Beverage Sector in Qatar

About D&B

8
 Food & Beverage Sector in Qatar

Food & Beverages Sector in Qatar

Total food demand in 2017 stood at USD 2.69 Bn, growing at a CAGR of 1.3% in the 2013-2017 period;
Qatar accounted for ~4% of the overall food consumption in GCC in 2016
Food Imports (USD Bn)
4.00
CAGR = 1.3%
Millions

3.50
CAGR = 6.8%
3.00

2.50

2.00

1.50 2.95 3.20 3.12

2.56 2.69
1.00

0.50

0.00
2013 2014 2015 2016 2017

◼ Qatar is highly import dependent for meeting its food requirements, a few products where import dependence is low are dates, dairy
and poultry products
◼ 2013-16 CAGR was 6.8% as population grew at a faster pace in the corresponding period; 2017 imports have been impacted due to
the disturbance of trade routes
◼ Qatar accounted for ~4% of the overall food consumption in the GCC in 2016, amounting to 1.9 million metric tons

Source: ITC Trade Map; Alpen Capital

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 Food & Beverage Sector in Qatar

Food Demand - Categories

Top 3 food products, accounting for more than 35% of total imports in 2017 are i) Meat & Edible meat
offal, ii) Dairy, eggs, honey, edible products of animal origin and iii) Cereals
Food Product Imports (USD Bn) – Top 15 products by import value in 2017

CAGR
Food Category 2013 2014 2015 2016 2017 growth
rate
Meat and edible meat offal 0.38 0.42 0.46 0.44 0.43 3.45%
Dairy produce, eggs, honey, edible products of animal origin etc. 0.33 0.37 0.40 0.40 0.34 0.70%
Cereals 0.16 0.33 0.27 0.28 0.23 9.82%
Edible vegetables and certain roots and tubers 0.21 0.24 0.28 0.27 0.22 1.11%
Live animals 0.22 0.28 0.31 0.22 0.20 -3.08%
Edible fruit and nuts; peel of citrus fruit or melons 0.15 0.16 0.20 0.23 0.19 7.24%
Preparations of cereals, flour, starch or milk; pastrycooks' products 0.19 0.19 0.21 0.21 0.18 -0.20%
Beverages, spirits and vinegar 0.18 0.16 0.20 0.17 0.15 -3.32%
Miscellaneous edible preparations 0.15 0.17 0.20 0.17 0.13 -2.91%
Preparations of vegetables, fruit, nuts or other parts of plants 0.09 0.10 0.11 0.11 0.11 5.16%
Animal or vegetable fats and oils and their cleavage products 0.10 0.09 0.10 0.11 0.09 -2.22%
Cocoa and cocoa preparations 0.08 0.08 0.08 0.09 0.08 0.45%
Coffee, tea, maté and spices 0.06 0.07 0.07 0.08 0.07 3.66%
Fish and crustaceans, molluscs and other aquatic invertebrates 0.05 0.06 0.08 0.08 0.07 5.09%
Preparations of meat, of fish or of crustaceans, molluscs etc. 0.05 0.07 0.07 0.08 0.05 0.31%
Other products 0.17 0.15 0.16 0.18 0.14 -4.13%
TOTAL 2.56 2.95 3.20 3.12 2.69 1.29%
◼ Top 3 food products accounting for more than 35% of total imports in 2017 are i) Meat & Edible meat offal (16%), ii) Dairy, eggs,
honey, edible products of animal origin (12%), and iii) Cereals (9%)
◼ Among the Top 15 products, cereals, edible fruits & nuts and fish showcased significant CAGR during the period 2013-17

Source: D&B Research

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 Food & Beverage Sector in Qatar

Food Trade Top Exporters to Qatar

The average value of the Top 10 exporters in 2017 to Qatar was USD 160.86 Mn, led by India with total
exports of USD 344.93 Mn
Top 10 Exporters (USD Bn)
0.6
0.5

0.4 0.4

0.3 0.34

0.2
0.2
0.2 0.20 0.20
0.20.2 0.15
0.2
0.1 0.10.10.10.10.14 0.10.10.13 0.13 0.12 0.1
0.10.1 0.10 0.10.10.1 0.09
0.10.10.10.1
0.00.00.10.1
0.00.00.00.0 0.00.00.00.0

India Australia Saudi Arabia Oman Brazil Netherlands Turkey United States Kuwait Jordan
of America
2013 2014 2015 2016 2017

◼ Imports from KSA have been on a decline for the past three years, dipping the most in 2017 (56%); imports from Oman (203%) &
Kuwait (234%) have increased significantly in 2017
◼ Imports from Turkey have grown 238% in 2017
◼ Import from USA and India have grown 42% and 38% respectively
◼ In 2017, Pakistan was the 18th largest import source, with total food imports of USD 39.50 Mn

Source: D&B Research

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 Food & Beverage Sector in Qatar

Key Growth Drivers

F&B sector in Qatar is expected to be driven by 3 major factors: (1) Population growth, (2) Increased
tourist arrivals and (3) Increased import substitution in view of the Economic Blockade
Population in Qatar is expected to grow at a CAGR of 1.7% to reach 3.3 Mn by 2030

Population Forecast in Qatar (Mn)

3.13 3.18 3.22 3.27 3.32

2.87 2.92 2.97 3.02 3.08
2.69 2.75 2.81

2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

Tourist arrivals estimated to increase at a CAGR of 5% Increased import substitution in view of Economic Blockade

International Tourist Arrivals in Qatar (Mn) ◼ Prior to the economic blockade imposed on 5th June 2017,
brands from KSA and UAE used to account for a majority of
2.39 2.51 2.63 2.76 2.90 the market share in many food products. The void which was
created due to blockade can be filled by local manufacturers
◼ In particular, in case of short-shelf life products, there is a
2018 2019 2020 2021 2022 huge opportunity as it is difficult to import by sea due to the
◼ International Tourist arrivals estimated to increase at a CAGR perishable nature of products, whereas importing by air is
of 5% to reach 2.9 Mn by 2022 very expensive
◼ This is due to the favorable policies of Government of Qatar ◼ Existing local companies such as Dandy, Gourmet etc. have
(like visa free entry for tourist from over 80 countries), FIFA seen considerable growth in market share post the blockade
World Cup 2022 etc.
Source: Alpen Capital, D&B Research

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 Food & Beverage Sector in Qatar

Food & Beverages Sector in Qatar Forecast

Total F&B demand is estimated to grow in line with population CAGR of 1.68% over the next 5 years to
reach USD 2.93 Bn by 2022
Food Imports (USD Bn)
4.00
CAGR = 1.7%
Millions

3.50

3.00

2.50

2.00

1.50 2.88 2.93

2.74 2.78 2.83
1.00

0.50

0.00
2018(f) 2019(f) 2020(f) 2021(f) 2022(f)

◼ The F&B sector demand is expected to grow in line with the population growth rate (1.7%) to reach ~USD 2.93 Bn by 2022
◼ The key reasons aiding food consumption growth in Qatar include high disposable income and urbanization rate, coupled with an
expanding consumer base. Additionally, infrastructure development in the build-up to the World Cup 2020 are expected to boost
tourist arrivals and eventually food consumption in the country. Moreover, the high affluence levels have backed the locals‘ demand
for high-value products

Source: SAK Holding Report

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 Agenda

Agenda
Qatar - Strategic Overview

Food & Beverage Sector in Qatar

About D&B

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