Iran Confectionery Giant Makes Inroads Into Qatar Market

EghtesadOnline: Iran’s biggest confectionery company, which is also one of the biggest in the Middle East, is planning to enter Qatar’s retail market.

News ID: ۷۸۰۱۷۵

30 October 2017

Shirin Asal Food Industrial Group, with a turnover of about $5 billion per annum, is planning to set up a factory in Qatar.

The company, which produces more than 1,000 products, including biscuits, cakes, pastries, jam, chocolates, wafers, cookies, crackers, chewing gums, hard candies, marshmallows, toffees and jelly products, as well as cocoa powder and butter, conducted a four-month-long market study in Qatar and got encouraging feedback.

The company also provides oilseeds and conserves, as well as raw, cooked, and frozen foods; and animal husbandry and industrial products, according to Financial Tribune.

“We have already done a market study in Qatar and fortunately there is demand for Iranian products. People in Qatar are willing to buy products which are produced in Iran,” Hossein Mahfouzi, Middle East export executive of Shirin Asal, told Qatar’s daily newspaper The Peninsula.

“Our future plan is to have a small factory for Qatar market as soon as we get the right feedback (about which product has more demand) from the market,” he said.

The market study was conducted to gauge the consumer preference and to know which of their product will have more demand in Qatar.

“We have done market study, but we are not sure about the demand in each category of products. As soon as we distribute the products in the market, we will have a right indication of which product is moving better than others. And, in that time, we will plan to have a production facility for that specific product that will be produced in Qatar,” he said.

Shirin Asal, which is exporting its products to 75 countries, is the only fully integrated Iranian confectionery group.

“We hope that we will expand in Qatar. We know that the market has its own capability and capacity to distribute products and hopefully we are going to find some companies to deal with in Qatar,” he said.

The company is looking for tie-ups with companies in Qatar for product distribution. It is planning to distribute products within this week and its products are expected to hit shelves of some hypermarkets in the first week of November.

“The products which will be distributed will be mainly cake-lines and confectionery items. In November, we hope to have our products in chains in Lulu and Al Meera,” he said.

The products coming out of the company’s production unit is likely to be cheaper compared to imported products.

“Cost of products from the production facility will be cheaper. The products will be naturally cheaper as it will be made in Qatar,” he said.

With around $118 million worth of exports, chocolate products were the main foodstuff shipped from Iran to overseas destinations during the six months to Sept. 22.

Exports, including all types of confectionery, from Iran stand at $600 million annually, according to Chairman of Iran’s Biscuit, Confectionery and Chocolate Industries Association Jamshid Maghazei.

The Commonwealth of Independent States is among major markets for Iranian chocolate. A limited volume goes to the US, especially to Iranians living in Los Angeles and California.

According to the official, sweets and chocolates account for 30-40% of Iran’s total food exports.

Based on figures released by the association, per capita biscuit, chocolate and sweets consumption in Iran amounts to 2 kg per year. The average figure for European countries stands at around 10 kg.

According to Ali Bahremand, the head of Confectioners Union, recession in the domestic market and the decline in people’s purchasing power in recent years have led to a drop in consumption in Iran by 40%.

Close to 50% of Iran’s biscuits and chocolates are produced in the city of Tabriz located in East Azarbaijan Province in northwest Iran. Shirin Asal is also based in this city.

There are over 850 production units in Tabriz exporting their products worldwide.