GCC food security: Why this challenge is different

The GCC imports a major share of its food and has spent a decade strengthening its resilience. But three pressure points are now volving simultaneously – sourcing disruption, supply-chain friction, and fertilizer tightness – and they reinforce each other in ways that change the commercial operating model.

The GCC imports more than 85% of its food. That alone makes food security a permanent strategic priority. The region has spent the past decade strengthening its position: expanding strategic reserves, diversifying trade relationships, investing in domestic production, and building logistics infrastructure that ranks among the strongest in emerging markets.

However, what has brought the region this far may not be enough for what is likely to play out now. Three pressure points are volving the GCC food system simultaneously – and they reinforce each other in ways that change the commercial operating model for distributors, retailers, and regulators alike.

Point of departure: a stronger system, with clear structural exposure

The GCC food system is large, growing, and strategically important. According to Alpen Capital, regional food consumption is projected to rise from 50.9 million metric tons in 2024 to 55.5 million metric tons by 2029. If the GCC were treated as a single agri-food import market, it would rank as roughly the ninth-largest globally in 2024 import value. This is not a marginal market. It is a major import platform whose resilience matters to households, retailers, distributors, and public institutions across the region.

The starting point is stronger than it was a decade ago. Several GCC governments have invested in strategic reserves, alternative sourcing, domestic production in selected categories, and logistics infrastructure. As a result, local output has increased meaningfully in areas such as dairy, poultry, and some fresh produce.

However, the baseline still carries material structural exposure. Several authorities estimate that GCC countries import about 85% of their food, including virtually all rice consumption and more than 90% of cereals. Aggregate supplier concentration is manageable at the top level: Top three supplying countries together accounted for less than 30% of the agri-food and seafood imports in 2024. However, the category picture is sharper. Milled rice, for example, the region’s largest import line, has been mostly (more than 90%) sourced from only two supplying countries in 2024.

The immediate problem: three pressure points now shape the operating environment

The present challenge is best understood through three mutually reinforcing pressure points. Each can be managed in isolation. Their combination is what changes the commercial operating model.

Sourcing disruption

The sourcing map has narrowed in practice. Several nearby and Asia-linked corridors that historically delivered speed, frequency, or commercial flexibility are now harder to rely on at prior service levels and economics. The aggregate supplier base remains broad, but the categories that matter most do not all enjoy the same degree of redundancy. In staples such as rice and sugar, the concentration is plain. In fresh produce, the exposure often appears as reduced access to previously important short-haul origins and slower replenishment from longer-haul markets that remain operational but less dependable.

Supply-chain friction

The second pressure point sits in the route itself. UNCTAD reports that daily transits through the Strait of Hormuz fell from an average of 103 vessels in the last week of February to single digits within weeks, effectively bringing flows close to a standstill. FAO reports that tanker traffic collapsed by more than 90% within days of the escalation. War-risk insurance premiums, previously around 0.25% of vessel value, rose to as high as 10% in early March, with cover resetting every seven days. The practical consequence is wider than freight cost alone. Asset utilization falls, transit reliability deteriorates, empty-container repositioning becomes harder, and vessels that do move are priced for risk rather than efficiency.

The route issue is also a time issue. Once the flow slows sharply, reopening is only the first step. Cargo already waiting must clear, vessels must return to rotation, and ports must absorb an uneven arrival pattern. For food systems, this matters most in categories that run on freshness and predictable cadence rather than deep storage. Financial Times reporting also suggests that roughly half of the 30 million tons of grain imported into the Gulf normally pass through the waterway, with smaller Gulf markets carrying less alternative port flexibility than the UAE and Saudi Arabia.

Fertilizer tightness

The third pressure point is the one that lifts the episode above a conventional logistics shock. The Strait of Hormuz typically carries up to 30% of internationally traded fertilizers and around one-third of global seaborne fertilizer volumes. The Gulf is also central to ammonia, urea, and sulfur trade. FAO estimates that the disruption has already stalled 3 to 4 million tons of fertilizer trade per month. UNCTAD notes that the same corridor carries a quarter of seaborne oil and large volumes of LNG, meaning route disruption feeds directly into nitrogen economics through higher gas prices. That combination is already visible in fertilizer markets: Middle East granular urea rose 19% in the first week of March and Egyptian urea rose 28%, while FAO projects that fertilizer prices could average 15–20% higher in H1 2026 if the crisis persists.

This is the mechanism that links a shipping shock to a food-security challenge. Higher fertilizer cost and weaker physical availability change planting economics. Growers ration product, prioritize higher-value acreage, delay purchases, or shift to less input-intensive crops. The direct effect lands first in nitrogen-sensitive crops and then works downstream into the food basket through yield, mix, and cost transmission.

How the disruption reaches the basket

The commercial consequences are uneven by category. Three questions matter most: how fertilizer-sensitive the upstream crop system is, how route-sensitive the import model is, and how much operational cover the category carries inside the GCC. Those three variables create a predictable split between availability risk and affordability risk.

Exhibit 1. Category exposure assessment for the GCC

Category cluster	Illustrative categories	Operational cover sensitivity	Route / service sensitivity	Upstream fertilizer sensitivity	Likely commercial issue
Strategic staples	Rice, flour, sugar, edible oils				Affordability pressure and contract repricing
Fresh traffic drivers	Tomatoes, onions, potatoes, cucumbers, lemons/limes				Availability gaps, sharp repricing, higher shrink
Higher-cover produce	Bananas, oranges, apples				Service disruption and higher landed cost
Long-tail fresh	Premium salads, berries, exotics				Range rationalization and selective delisting
Format substitutes	Canned tomatoes, frozen vegetables, value rice packs				Demand migration as consumers trade across formats

_{Illustrative Simon-Kucher category screen based on GCC import structure, perishability, and current route and fertilizer risk.} 

The strategic implication is straightforward. Fresh and short-cycle categories sit on the availability side of the problem. Staple categories sit on the affordability side. Actions, however, would depend on more criteria, such as a shifting supply base, competitive responses as well as value chain economics, making the execution-level decisions much more complicated.

Based on discussions in the recent weeks with the clients who are on the frontline of the challenge, Simon-Kucher approached this challenge across two main scenarios to assess the impact and derive implications. The first assumes traffic begins to normalize after roughly two additional weeks, but the market still absorbs an elongated queue-clearing period. The second assumes roughly two additional months of heavy disruption, with a backlog and fertilizer overhang that reaches into the next crop cycle.

Based on these two directional scenarios, we lay out action agendas across different player profiles, namely distributors, grocery retailers, and regulators. These action agendas are also detailed across a time horizon, prioritized by the dependency on the scenarios (no-regret moves early on, scenario-dependent actions later on). This way, the market players will have a chance to stabilize their operations fast and institutionalize their response for sustainable economics in time. 

Exhibit 2. Scenario outlook summary for GCC food ecosystem 

_{Scenario ranges are directional and intended for strategic planning rather than forecasting.} 

Value chain economics clarify why different categories behave differently. Imported tomatoes carry relatively high exposure to freight, cold chain, and shrink. Rice carries a larger farmgate and milling component, but much lower operational fragility once in the import system. 

Exhibit 3. Imported tomatoes - indicative landed-to-shelf model 

_{Illustrative Simon-Kucher unit-economics model for imported fresh tomatoes in the GCC.} 

Exhibit 4. Rice - indicative landed-to-shelf model 

_{Illustrative Simon-Kucher unit-economics model for imported milled rice in the GCC.} 

The implication is operationally important. Tomatoes become a service-level, shrink, and price-execution challenge. Rice remains a supply-security category, but the more immediate management question is affordability and price architecture rather than shelf absence. 

Strategic outlook

The question is no longer whether this disruption will affect prices and availability in the GCC. It already has. The question is how distributors, retailers, and regulators respond – and whether they treat this as a one-off firefighting exercise or as the moment to build lasting commercial resilience.

In part two of this series, we lay out what leading players across the value chain are doing now – structured around six commercial levers and two time horizons. 

Want to discuss your food security strategy? Get in touch with our Simon-Kucher experts.