Time For Regulation~America’s Halal Industry

By Abdalhamid Evans

The growth of the Halal market has become a global phenomenon. With the majority of the Muslim world dependent on food imports to meet their needs, countries such as Australia, New Zealand and Brazil have long been established as major suppliers to the halal market. Currently the USA lags behind these leaders in both sales and regulatory infrastructure by a considerable gap. Is it time for America to step up its game and become a leading player in the Halal industry? And if so, what would it take?

Collective Effort

As we are reminded, in the hadith of the Prophet, salla’llahu alayhi wassalam, that the fortunate one is the one who can learn from the experience of someone else, let us take a look at Australia’s experience.

It has been suggested that Australia is about a decade ahead of the USA in terms of its approach to supplying the Halal markets. The recognition of the significance of this market by Australia’s industry and government stakeholders has resulted, after many years of internal struggles and difficulties, in a collective effort between the governmental health and safety regulatory bodies, the red meat industry and the various Islamic bodies involved in Halal certification.

Getting this three-legged structure in place is not as easy as it sounds; and the pivotal piece of the puzzle to solve is the question of how to manage the Halal certification bodies. Halal certification is, if you will allow me the pun, a real cash cow; an unregulated cash cow that is not always all that Halal either. With no clear standards, no third-party audits, no oversight and riddled with conflicts of interest, Halal certification procedures in the non-Muslim world, especially for meat and poultry, are still in the time of the Wild West before the sheriff came to town.

Despite the statutory separation of church and state, the Australians recognised – more than a decade ago – that the value of the Halal export market to the national economy warranted an effective structure to guarantee both the quality and integrity of the product, and the consequent market share.

The result is the AGAHP, the Australian Government Authorised Halal Programme. This is effectively a collaboration between the Australian Meat Industry Council (AMIC), Meat and Livestock Australia (MLA) and the Australian Quarantine Inspection Service (AQIS).

This collaboration resulted in a set of guidelines for slaughter of livestock, the preparation, identification, processing, storage, segregation and certification of Halal red meat products for export to Halal markets.

Under the AGAHP, both abattoirs and Islamic bodies must operate under an Approved Arrangement (AA) that meets the AGAHP guidelines. For an Islamic Body to be approved, they must meet the criteria laid down in the government legislation. This naturally caused a shake-down in the number of Islamic bodies that carried out certification, but the result has been a workable tripartite collaboration that has resulted in a Halal industry with consistent high-quality products that are verifiably Halal, and a similarly consistent share of the Halal market.

Home on the Range

For the USA to move into a position approaching that of Australia, several changes will need to happen. The first is a question of perception. There has to be recognition by the key decision-makers that the Halal industry is worth developing. With a global Muslim population of 1.6 billion, around 26% of the global population, the majority of which is import-dependent, the question is really ‘why would you not be interested in this market?’

The USA is in the difficult position of being a global power that has passed its peak. It is always hard to accept that from here the road basically leads downwards, and even harder to make the necessary changes to accommodate the shifting status on an increasingly fluid world stage.

Being in a dominant position for long periods of time makes it easy to become complacent, and as a major food exporter, this is exactly what can be seen in the Halal industry in the USA. The trend in the global Halal marketplace is for higher standards, more integrity and a greater degree of oversight surrounding Halal compliance.

For example, both Malaysia and Indonesia are now requiring Halal meat to be produced on dedicated lines, and as there are none in the USA, this means that exports to these countries will stop unless some changes are made. While some may argue that these markets are not that important, and that exports to the bigger GCC markets can carry on as usual, but this perspective is to miss the writing on the wall.

The Halal markets are evolving. It is becoming a case of choosing between adaption or extinction. Such is the dynamic of the free market. It would be an irony for the USA to miss the very point of the market philosophy that they have defined and exported to the rest of the world.

Compared to Australia, the USA Halal industry is still in the dark ages. Halal certification continues to be carried out with no regulatory oversight by the USFDA. There are well-documented cases of export agents buying non-Halal products from major USA manufacturers, obtaining a Halal certificate, ink-jetting a statement of Halal compliance onto the existing labels and sending the products into the GCC markets as certified Halal products. When questioned, the manufacturers will say that they do not manufacture any Halal products…and yet there they are in the Halal marketplace.

The fact that this has worked until now is not a proof that it will continue to work in the future. The fact that it is widely known that these practices go on is a strong indication that they will soon have to come to an end.