Analysis The date palm and its fruit are emblematic of UAE life, and businesses selling the fruit aim to expand their popularity.
Fruit of the desert makes its date with history
The date palm has been an integral part of UAE history, providing a staple food for the Bedouin people, who also used its fronds to make shelters and wove its leaves into mats.
Its sweet, oval fruit is thought to have been cultivated in the Arabian Peninsula for more than 4,500 years, and the Abu Dhabi island of Delma holds the earliest evidence of human consumption of dates here. But as the Emirates has modernised, so has the date, evolving into a luxury treat, perhaps covered in milk chocolate and stuffed with caramelised pecans, often displayed in glass cases. "Date trade is something traditional," says Farid Karmostaji, the director of export-market development with the Dubai Export Development Corporation (EDC).
"As long as the population is growing, we will get this growth. But also, people are coming with new ideas. These promotional ideas help us to export more dates to a lot of countries." The fruit, which is grown by 16,000 farmers in the UAE, as well as across the Middle East, continues to be a key food during Ramadan. Traditionally, it is the first food eaten by Muslims to break their fast after sunset during the holy month.
Now it is also a delectable treat for special occasions. There are dates stuffed with candied lemon rind, or coated in white chocolate and stuffed with pistachio nuts, or even used in chocolate truffles. Rather than sold loose in baskets at the souk, the dates are presented in gift boxes, akin to high-end chocolates or jewellery, sometimes with a brown suede finish and a satin bow or in a cherrywood box.
But while the fruit is an integral part of UAE heritage, some date sellers are looking for ways to diversify away from the dried date to boost revenues. "I think the growth will come from more products to be made from dates: date bars, date juices, date energy drinks," says Dr Ata Atmar, the managing director of the gourmet date retailer Bateel. "The culture of actually getting people to eat more dates is a huge task and I think it's beyond one company."
Bateel is branching out beyond the luxury desserts that have made its name and expanding into opening gourmet food stores that may not feature the sweet fruit. "We originally started with dates and dates is a very seasonal business," Dr Atmar says. "We want to have all-year-long sales." Last year, the date trade in the Emirates was worth about Dh390 million (US$106.7m), including Dh145m in imports, Dh80m in exports and Dh165m of re-exports, according to the Export Development Corporation. That was a 9 per cent rise over the previous year
In the first half of this year, the UAE date trade seemed to show similar growth, with sales of more than Dh242m, up strongly from the first half of last year even before Ramadan. That growth is at odds with the experience of UAE retailers in general. While food sales have been relatively resilient, overall retail sales are down by as much as 40 per cent as consumers are more careful with their spending in the downturn.
Vivek Sharma, the deputy managing director of Bateel, says sales at his company so far this year have grown by 20 per cent, nearly half the rate of the previous year. Its sales at stores open at least a year were flat. "We normally grow at 30 to 40 per cent same-store sales, so there has been a slowdown to the extent that the growth comes from the new locations that we have opened," Dr Atmar says.
To help support its diversification, Bateel plans to open a much larger store in Jeddah this year, covering 200 square metres instead of the more usual 60 to 100 sq metres. The shop would include a dedicated section for gourmet foods not based on dates. While the company has not decided how many of these stores it will open, Dr Atmar predicts that these new stores will have double the sales than those that focus solely on date treats, which Bateel has sold since 1991.
The company has also been slowly stocking its displays with new products, many of which are date-free, such as nuts, salad dressings, tapenades, coffee and pasta. These are currently available in their stores and cafes. A continually expanding portfolio of products will be the main driver of sales growth, Dr Atmar says, adding that sales of the dried fruit already make up just 30 per cent of its total sales.
The other 70 per cent consists of products such as chocolate, biscuits, bread and salad dressings, as well as other related products such as a sparkling date beverage. "Most of the companies are diversifying now," Mr Sharma says. Bateel is also building on the success of its shop on London's Bond Street and looking to open more of these stores on the continent. After Europe, the company will shift its focus toEast Asia, Egypt and Turkey, and expand more in Saudi Arabia, where the brand was founded.
Ultimately, Bateel wants to become more of a gourmet food retailer similar to Fauchon in Paris, Dr Atmar says. Robert Ziegler, the vice president of the management consultancy AT Kearney in Dubai, says there will always be room for a niche gourmet store, no matter what the economic situation. "The affluent segment is not going to change buying patterns," Mr Ziegler says. "You're going to find that they're still looking out for specialities."
Othman Aljbawi, the sales manager of Kingdom Dates in Sharjah, says sales remain resilient this year and are unaffected by the economic downturn. While he could not give exact figures, he says the company's sales of the dried fruit have grown. "Dates, our products, are very popular here in this area of the world and as important as bread and water." The company concentrating on its current line of dates, which includes chocolate-covered versions, but it would look at branching out into more varieties or confectionery in a couple of years, says Mr Aljbawi.
Ravi Jangid, the director of La Ronda, which is based in the UAE and makes chocolate-covered dates and other products with the fruit, says sales have fallen by 20 per cent compared with the same time last year. The main reason is a fall in tourist numbers to the UAE. "The gourmet dates, that all depends on the tourist traffic," Mr Jangid says. "Those are the people that come in and buy them." La Ronda exports its date products across the GCC, South East Asia, the US and parts of Europe, but is on the lookout for opportunities.
For Bateel, dates remain at the heart of the operation, even with its diversification strategy. The company, which only uses dates grown on its own farms, plans to expand production by adding land this year. Bateel will be acquiring a new farm in Saudi Arabia, which will have the capacity to produce 150,000kg of dates each year. @Email:firstname.lastname@example.org