Halal Logistics Market Valued at US$ 321.2 Billion in 2023

The global market for halal logistics is on a trajectory of robust growth. From 2021 onwards, this sector is forecasted to expand at a Compound Annual Growth Rate (CAGR) of 5.1%, escalating from a valuation of US$ 321.2 billion to a whopping US$ 528.2 billion. A significant driver behind this growth is the halal product storage sector, which currently dominates by holding 60% of the global market share.

Ensuring Halal Standards Throughout the Logistics Chain

The stringent requirements surrounding halal commodities are not only confined to production but extend to storage as well. Upholding the sanctity of halal products involves a meticulous sorting process during storage, ensuring that the entire supply chain – both upstream and downstream – adheres to the prescribed halal guidelines. In this vein, halal compliance ensures that as products exit the storage facilities and traverse the supply chain, both the product and its respective container are certified as halal.

What Fuels the Halal Logistics Market’s Growth?

A confluence of factors has spurred the halal logistics market’s upward momentum. Notably, the burgeoning high-net-worth Muslim population has catalyzed this surge. As the global halal food market blossomed, concurrent with a rise in the Muslim populace, a significant uptick in spending on halal products was observed. Factors such as enhanced educational opportunities and better employment avenues have amplified Muslim consumers’ spending prowess. While traditionally the term “halal” denotes foods that align with strict codes of hygiene, cleanliness, and religious adherence, its significance has now transcended beyond just food.

Interestingly, the expanding affluence among the Muslim demographic isn’t the sole driver. The halal market has received a significant boost from non-Muslim customers, spanning varied ethnicities and religious beliefs, showcasing an affinity for halal-certified products.

Competitive Landscape: Key Market Moves

To illustrate the market’s dynamic nature:

• In March 2021, Nippon Express rolled out a halal air freight service in Japan, catering to the domestic cargo transport sector. This initiative, combined with its Express Hi-Speed domestic air freight service, aims to offer comprehensive logistics solutions to Japan’s Muslim community, numbering approximately 200,000.
• Similarly, dnata, a prominent aviation services provider, secured the ISO 9001:2015 certification for its cargo handling operations in April 2021. Complementing this, dnata also received a halal certification from Majlis Ugama Islam Singapura (MUIS) for its specialized storage room within the Coolchain facility.

Key Market Players Setting the Pace

Leading the charge in the halal logistics sector are prominent names including DB Schenker, Hala Group, HAVI Logistics, Tasco, TIBA Group, and many more. Their strategic moves and innovations have been instrumental in shaping the market’s direction.

Regional Deep Dive: GCC Countries Leading the Pack

The Gulf Cooperation Council (GCC) countries, buoyed by a significant Muslim populace and a keen inclination towards halal-certified processes, have emerged as substantial revenue contributors. Factors such as surging disposable incomes and the exponential growth of the halal food sector act as catalysts. Additionally, the innovative spirit prevalent in the region, paired with the rising demand for unique halal products, offers a plethora of opportunities for food and beverage manufacturers.

Challenges on the Horizon

While the future looks promising, the halal logistics market does face some headwinds. Challenges like soaring inventory costs, limited warehouse space, and notably, a lack of uniformity in halal standards across countries, can act as growth deterrents. The inconsistency in regulations has been further exacerbated by illicit meat exports to the Middle East, casting doubts on the authenticity of halal products sourced from non-Muslim countries. Consequently, entities operating within the halal logistics domain are under immense pressure to maintain the integrity of their products, ensuring they consistently meet established halal norms.

The halal logistics market, with its vast potential and unique challenges, offers a fascinating landscape for stakeholders. Its growth trajectory, dictated by both consumer demand and innovative solutions by market players, promises a future replete with opportunities and innovations.