UAE's Growing Role as Nut Distribution Hub Driven by Increasing Imports and Domestic Demand

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Published Mar 23, 2023

The UAE has solidified its position as a major nut distribution center in the region, importing more than 150,000 metric tonnes of almonds, walnuts, cashews, and pistachios in 2022. In the first two months of 2023, imports of these nuts more than doubled YoY, to 30,841 mt. The country's role as a transit hub is expanding, while domestic consumption is increasing and getting a further boost from a return to pre-pandemic tourism.

The UAE has seen a rapid increase in nut consumption over the last decade. The country’s further cemented its role as a nut distribution hub in the region throughout 2022, with more than 150,000 mt of almonds, walnuts, cashews, and pistachios (on a kernel basis, excluding pistachios) imported throughout the year. The UAE is itself a large consumer of nuts, but its strategic location and modern logistics make it an important distribution center.

In 2022, UAE imports of almonds, walnuts, cashews, and pistachios increased by 26% judging from the country’s largest nut suppliers. UAE customs data, detailing nut trade, might not be available for several months, but using mirror data from its top 2 or 3 largest suppliers shows a rapid increase in imports. Almond imports increased by 15% YoY to 66,307 mt in 2022, walnut imports by 59% YoY, to 34,413 mt, cashew kernel imports by 21% YoY to 28,876, and pistachio imports increased 30% YoY to more than 15,172 mt. In all cases, the top suppliers had more than a 95% market share in UAE imports for the relevant nut category. All volumes are on a kernel basis, except pistachios, which are on an in-shell basis. On average around 75% of imports are re-exported to other countries in the region.

Source: Almond Board of California, Almond Board of Australia, California Walnut Board, Chilenut, General Administration of Customs of the People’s Republic of China, VINACAS, India Department of Commerce, Iran Pistachio Association, Administrative Committee For Pistachios

Preliminary data shows that imports in the first two months of 2023 were exceptionally strong due to the upcoming Ramadan season, with almond imports increasing by 95% YoY, walnut imports virtually tripling, and cashew and pistachio imports increasing by 50% respectively. China exported walnuts worth USD 34 million to the UAE in the first two months of 2023, which could amount to 7,300-7,500 mt on a kernel basis.

*Based on Tridge estimates

The UAE's high GDP per capita, which stands at USD 44,315, ranked 31st globally, has positively influenced the consumption of high-value snacks like nuts. In addition to being a popular snack, nuts are also commonly used as an ingredient in Middle Eastern cuisine. Based on domestic disappearance, per capita consumption of almonds is close to 2kg annually, one of the highest globally. The return of tourism to the UAE has also increased domestic consumption, as nuts are served as snacks in high-end hotels and restaurants. In 2022, Dubai welcomed 14.36 million overnight visitors, much higher than the 7.28 million in 2021 and 5.51 million in 2020, but still below the 16.37 million visitors received pre-pandemic, in 2019.

Apart from growing domestic consumption, the country’s role as a transit hub is also expanding. The modern port infrastructure is one of the main drivers behind the growth. Many nut shipments arrive in bulk at the Port of Jebel Ali, one of the largest and most modern globally, from where it is redistributed in smaller shipments according to orders from other countries.

The UAE has several free trade agreements in the region, one of the most important being the Gulf Cooperation Council and Pan Arab Free Trade Area, which allows it to export nuts at zero tariffs to member countries, with some key countries being Suadi Arabia, Oman, Kuwait, and Yemen.

However, one of the most important trade relationships in terms of nuts is with Iran. The UAE serves as a buffer zone for the sanctions imposed by many countries on Iran, which do not allow for direct trade. On average more than 40% of the UAE’s almond exports, 70% of its walnut exports, and 40% of its cashew exports are destined for Iran, while Iranian pistachios are re-exported from Dubai.