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2014 Media Kit
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Europe ash cloud dents Gulf Arab luxury food supply

By: | at 08:00 PM | Air Cargo  

A Gulf Arab airline ditched a massive cargo of fresh fish and the desert region’s supermarkets are fretting over fruit and vegetable imports trapped in a backlog of flights created by Europe’s ash cloud.

As European air space reopens to flights that were closed by the cloud of volcanic ash which drifted over from Iceland, retailers and consumers in Gulf Arab countries are literally taking stock as airlines scramble to shift a backlog of cargo and passengers that could take days or weeks to clear.

“The situation is really bad,” said Gapesh Gerash, manager at Dubai-based Barakat Vegetables and Fruits, which imports 2,000 kg (4,409 lb) in air freight from Europe four times a week.

The ash cloud highlights the heavy dependence on food imports from abroad for the Gulf’s wealthy nationals and the foreign expatriates seeking a taste of home, from imported Dutch tomatoes to French cheeses and Belgian chocolates.

Gulf supermarkets do rely in large part on Africa and Asia, but those imports cannot entirely make up for emerging shortages in European food supplies, especially for consumers seeking Western goods.

“We import the majority of our food from Europe, and right now the only option is some charter flights, but they are charging double the normal rate,” Gerash said.

Gulf Arab airlines could lose $15 million a day over European cargo and passenger flight disruptions, said Abdul Wahab Teffaha, head of the Arab Air Carriers Organisation.

“The economic value is going to be astronomical,” he said.

A planeload of more than 100 tonnes of fish due to be exported to Europe on Dubai government-owned Emirates, the Gulf Arab region’s largest airline, had to be frozen by owners due to flight cancellations, the carrier said.

Emirates, which is losing $10 million a day due to ash disruptions, said that 2,000 tonnes of cargo had been disrupted.

Gulf states rely heavily on food imports from Asia, Europe, the United States and Africa, and have recently resorted to buying farmland in developing nations to ensure food security.

“From a food and drink point of view, the fact that ... most of the Gulf region ... is so reliant on imports to meet domestic demand means it is more affected by the ash cloud in terms of stocking shelf space at grocery stores,” said Shonil Chande, food and drink analyst at Business Monitor International.

Supermarkets, Restaurants Feel Pinch

Spinneys, one of the biggest supermarket chains in the region, was running out of berries and said it saw a shortage in short shelf-life fresh foods from Europe and the United States.

In Kuwait, customers at one large supermarket chain were unhappy, and sometimes even rude, about not getting their regular doses of European cheese and chocolates.

“We get calls from dissatisfied customers. They complain and ask when it is coming,” said Firas Hamdan, chief commercial officer of The Sultan Center.

Restaurants were also feeling the pinch, with luxury chain hotel Fairmont saying it was running short on seafood brought in via Europe and had to improvise.

“From a food and beverage standpoint, we have been affected in terms of supplies coming in. We started using regional suppliers more,” a spokeswoman for Fairmont Dubai said.

Dubai, the Gulf region’s trade and tourism hub, handled around 172,000 tons of cargo in February.

Michael Meagher, of Saudi Arabian Airlines cargo division, said cargo operations had been hit, with the carrier running a significant and growing backlog in Europe.

Gulf hoteliers, however, have experienced a surge in occupancy from thousands of stranded passengers since the ash cloud appeared, especially in areas close to airport.

“We have been having too many bookings. Our occupancy rate is around 90 percent when normally it is 60 percent this time of year,” a representative at Dubai’s Millennium hotel said.

The five-star Bustan Rotana said occupancy had shot to 100 percent from 60 percent in the past few days. “Flight delays were good news for us,” a hotel manager said.

Dubai’s Al