The Basic Knowledge about Halal
Halal (“حلالا”) refers to what is permissible in Islamic law. The term halal is particularly associated with Islamic dietary compliance, among others, emphasizing on how meat is processed and prepared, with the accordance that meets the high standard of Islamic hygiene.
Halal encompasses all aspects of life based on Islamic guidelines. It portrays trust, respect and ethics. In short, Halal is a way of life.
Global Halal Ecosystem
The overview of the Global Halal Ecosystem can be represented in the infographics below:
Market size and potential
Halal consumerism has indeed gained an exponential growth in recent years. The global Halal industry is estimated to grow from US$1.7 trillion in 2012 to US$2.67 in 2018. It is further forecasted that this figure will grow to US$3.2 trillion in the following year, with an increment to US$10 trillion by 2030.
Looking at the overall global Halal Economy, the largest sector in this industry is Islamic Finance with a 43% share of the market, followed by Halal food and beverages (F&B) with a 36% market share. Thus, making it as one of the fastest growing consumer segments in the world.
Having said that, the global Halal industry is no longer confined to food and food related products. The Halal industry has now expanded beyond the F&B sector to also include pharmaceutical, cosmetics, health products, personal care and medical devices as well as service sector components such as logistics, marketing, packaging and more.
Its evolution also now sees the industry offering lifestyle products and services, such as Halal travel and hospitality, as well as fashion. This resulted in increased number of affluent Muslim travellers and the emerging numbers of Muslim millennials who have nowadays become key influencers in Halal consumerism, and are driven by the change in purchasing behaviour and ethical consumer trends worldwide.
The Halal market is no longer exclusive to Muslims, and has gained increasing acceptance among non-Muslim consumers who associate Halal with ethical consumerism. The values promoted by the Halal industry has gathered interest beyond its religious compliance. Hence, the popularity and demand for Halal-certified products among non-Muslim consumers have been on the rise as more ethical consumers are looking for high quality, hygienic and ethical products.
The definition of Halal has become a powerful market force, becoming increasingly a worldwide market phenomenon for both Muslims and non-Muslims. The appearance of the “Halal” symbol to a product and services is not just a guarantee that the product is permitted for Muslims, it has also become a global symbol for quality assurance and lifestyle choice.
A) Halal pharmaceutical market size
Halal pharmaceuticals market
Uptake of Halal medicines is gaining major traction globally, primarily due to two reasons. Firstly, these medicines are fully compliant with faith and so are readily acceptable under religious laws. Secondly, these medicines are very well assessed for quality and certification before being released into the market and are mostly made using herbal and synthetic materials. The market for halal pharmaceuticals is expected to register a significant CAGR as well as annual growth rates over the forecast period. Regulatory harmonization and regional regulatory convergence is expected to emerge as the key market trends in the near future.
B) Halal cosmetic market size
Rising demand from non-Muslim countries
Halal cosmetics are considered safe, high quality and hygienic. More and more people are aware of the importance of having the halal logo when they look for a product to buy. This has encouraged other countries with a high percentage of non-Muslim, like India and China, to adopt this lifestyle change. Non-Muslim consumers accounted for around 31% of the sales of halal cosmetics in 2016, and this share is expected to increase during the forecast period.
C) Halal logistics market size
Cross boarder logistics enables global trade and involves a range of sectors such as warehousing, shipping, rail, air freight, shipping security, inventory management, supply chain management, procurement, and customs services. Considering both domestic and international trades, the total estimated cost for logistics was estimated at $8.3 trillion in 2012 globally, representing 11.6% of global GDP. In 2013 the estimate for logistic costs for the global Halal Food market was $151 billion.
D) Halal consumer product market price
From a geographic perspective, the market is segmented into North America, Europe, Asia Pacific, Latin America, Middle East and Africa. Looking at the presence of a large number of certified manufacturers and at the large Muslim population, the halal products market in Asia Pacific is projected to have a significant positive impact on the overall development of the global halal products market in the near future. Amongst all the countries mentioned above, Brazil, United States of America, and India are some of the most significant exporters of halal products
E) Halal Slaughter house market size
Since halal animals are slaughtered, processed, and prepared according to strict Islamic dietary laws, these foods are considered healthy and hygienic when compared to non-halal meat. The market for halal foods is growing rapidly which indicates the inclination of other community consumers toward halal foods. Thus, there is a huge opportunity for halal companies to also consider non-Muslims population as their target consumers.