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Kuwait Is a Honey of a Market for U.S. Exporters
By Hovaguim Kizirian
Honey-gold sunlight spills in from an open kitchen window. A
kindly grandmother is makin
g treats for her
visiting grandchildren. The sweet smell of peanut butter and
sugar baking together is everywhere.
If she lives in Kuwait, she may be making semsemia. In that recipe, peanut-butter is a combined with sesame seeds and walnuts. It’s scented with rosewater and sweetened with a healthy dose of honey, which probably came from the United States.
There are lots more grandchildren in Kuwait to cook for these days–the population increased by almost half a million between 1993 and 1998. In the same time period, total annual honey imports have grown 3 percent overall–and for the United States imports rose 6 percent.
Economists link the growth in honey trade to the increase in people–since domestic honey production in Kuwait is almost nonexistent.
A Long-Term Growth Trend
Kuwait’s total imports of honey in 1993 were 686 metric tons. In 1999, 800 tons are projected–with the United States contributing more than a fourth of that total.
Forecasts for the year 2004 suggest that honey imports could reach 1,000 tons, and that the U.S. share could rise to one-third or 360 tons.
There’s more good news from Kuwait for exporters. That country has re-built its petroleum sector, ravaged during the Persian Gulf War. Its economy improved between 1994 and 1997. Telecommunication systems–both domestic and international–have been restored, facilitating shipping and ordering.
A Prize for Size–and Shape
One reason U.S. honey is doing so well is, of course, its reputation for high quality. The other reason is U.S. companies offer a range of package sizes. Kuwait customers prefer buying smaller sized jars–227 to 454 grams.
Another selling point is whimsical packaging. Plastic containers shaped like bears, houses or pyramids are popular with local consumers. Some consider it a sign of the power children have over their parents’ shopping behavior.
There is also a market for larger packages, usually from 750 grams to a kilogram, but that is usually for larger families and institutional use.
Who Buys the Honey?
As the packaging preferences suggest, most of the honey–about 80 percent–is being sold at retail. About 10 percent goes to institutional use, mostly purchased by the government for public hospitals and the military.
Where are consumers buying their honey? Most Kuwaitis shop at one of 43 consumer cooperatives, located in various districts of the country, including Kuwait City. Statistics show these cooperatives supply 80 percent of the food sold in Kuwait.
There are a few Western-style, privately owned supermarket chains, as well as some smaller supermarkets that make up the rest of the sales.
Brand Names Hold Power in Kuwait
Normally, one or two brands from each honey-exporting country
take the lead in sales. From the United States, Sue Bee
brand honey accounts for an estimated 25 percent of the total
market. Capillano and Diamond brands from Australia together
account for about 30 percent. Germany’s Lagnese and Hintz
brands combined make up 15 percent, and Al Shifa from Saudi
Arabia comprises 10 percent. These percentages do vary annually,
depending on marketing, distribution and other factors.
Who’s the Top Bee?
Australia and the United States compete neck-and-neck for the leading position in Kuwait’s honey market. Together, they make up about 60 percent of Kuwait’s total honey imports. Their market shares alternate, depending on product quality and pricing within a given year.
Getting the Honey to Customers
Kuwait has about 25 private importers who handle honey, including a dozen leading distributors who dominate the market. The wholesale mark-up for food in Kuwait is normally 10 percent, while retail mark-up adds on another 10 to 15 percent.
As for getting their message to the consumer, honey trade associations report that, in Kuwait, newspapers are the least expensive and most effective advertising option. In-store promotions are also valuable. Television advertising, while effective, is costly.
Exporting Honey to Kuwait Is Sweet
Compared to the requirements of other nations, exporting food to Kuwait is worry-free.
There are no import duties on any food product, including honey, in Kuwait, nor import quotas, import licenses nor any other non-tariff barriers for honey.
Take Time To Write the Label
Honey exporters need to label their products carefully. Production and expiration dates must be printed on all food products, and, while there are no shelf life requirements, most traders require a 24- month shelf life from suppliers.
One special note: the production and expiration labeling requirements are very precise. Make sure they are printed in indelible ink and follow the order of day, month and year. Dates can be printed in English or Arabic, provided that only digits are used. For example, 4/7/99 would be acceptable, but July 4/99 would not.
The food labels must also include: the
honey’s brand, country of origin, additives, manufacture
contact information and any special storage instructions.
This Is Only a Test...
All newly imported food products to Kuwait are tested for wholesomeness and compliance with local standards and regulations. If the product passes the initial testing, shipments are not re-tested until a reasonable time period has passed–usually about six months.
For details on import requirements, aspiring exporters can contact FAS’ agricultural trade office in Dubai or look up the standards on the web at: www.fas.usda.gov
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Hovaguim Kizirian is an agricultural marketing specialist at the Agricultural Trade Office of the American Consulate General, Dubai, United Arab Emirates. Tel.: (011-971-4) 3314-063; Fax: (011-971-4) 3314-043; E-mail: atodubai@emirates.net.ae; Web site: www.usembabu.gov.ae/atodubai.htm
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