Chefs in the glitzy city are revamping their menus, while others are turning to regional or locally sourced cuisine, or offering fewer dishes.
DUBAI, UAE – Dubai chef Shaw Lash at Mexican restaurant Lila Molino jumps into his avocados and tomatillos, the small green fruit native to Central America that is a Mexican staple and key to its colorful and spicy cuisine.
Now of the two-month war in Iran makes such ingredients harder to find and more expensive, Lash and other chefs said, while the Gulf struggles with closure of the Strait of Hormuz sea routes and rising jet fuel prices increase air freight costs.
Lash has scaled back production, cut his payroll, and is buying ingredients in smaller quantities for now — moves he hopes will be short-lived. She features her homemade fajita kits that have become popular, and her vegetarian line.
“The reality is that freight has become more expensive, gas prices have gone up, the Strait of Hormuz is still blocked,” Lash told Reuters at his restaurant in Dubai’s Alserkal Avenue arts and culture district.
“This poses a problem for our supply chain.”
Chefs in the glitzy city are changing their menus, with others turning to regional or locally sourced cuisine, or offering fewer dishes. Dubai authorities have introduced extensive economic assistance measures, fee relief and food campaigns.
This trend is a challenge for the wider UAE full-service restaurant market estimated to be worth $9.5 billion last year by market researcher Mordor Intelligence. Before the war began, it predicted a growth of 20% to $ 11.3 billion this year.
But war can change the equation. After the US and Israel attacked Iran in late February, the Gulf witnessed several weeks of Iranian missile and drone attacks. Although the ceasefire came into effect on April 8, the Strait of Hormuz, the only sea route to the UAE, which imports more than 80% of its food for consumption, remains closed.
The war has reduced the region’s tourist numbers, hit shoppers at luxury malls, luxury car sales, and disrupted restaurants, a pillar of Dubai’s booming entertainment and tourism industry carefully built on an image of luxury and safety.
Research by Juniper Strategy and the Global Restaurant Investment Forum found that UAE food service operators reported that they were experiencing an average 27% drop in demand levels compared to a year ago. The cost of suppliers increases by an average of 13%, according to the report, which consulted 30 industry leaders between April 1-8, who operate 400 restaurants.
It added that tourist areas and business districts were under great pressure while residential establishments showed great resilience, and in some cases, growth.
Dubai’s Department of Economy and Tourism said in a statement that some operators were going through a “period of disrupted change” and were looking for creative ways to respond.
“Across the city, restaurants, chefs and venues are transforming through new designs, targeted offerings and community-led initiatives,” it said in a document sent to Reuters.
The UAE Ministry of Economy and Tourism did not respond to a request for comment.
Chefs turn to natural ingredients
Kelvin Cheung, chef at Jun’s Dubai fusion restaurant, told Reuters that finding alternative ways to ship perishable ingredients, such as Norwegian nuts or some Japanese seafood, has been a costly challenge.
“Your only option was to fly the cargo, which would have increased our costs by about thirty, thirty-five percent,” he said, adding that he has turned to using local fish on his menu.
Air freight rates have risen by as much as 70% on some routes as the war has blocked oil shipments from the Gulf and increased the cost of jet fuel. Flights to and from the UAE are slowly returning to normal.
“Tourism has taken a big hit,” Cheung said. “That huge flow of tourists that provides additional economic growth, consumption, in all industries is what we are missing now.”
Cheung has introduced a six-course menu for 225 dirhams ($61) using local ingredients. The restaurant has retained all of its employees. Other locations are set to launch discounted meals for Restaurant Week in May.
The crisis has added to existing challenges such as high fixed costs, dependence on tourism and supply chain exposure, said food writer Courtney Brandt, who has been in the area since 2007, adding the market was already saturated before the war.
“We had to be corrected,” he said, adding that international brands, often with celebrity chefs and deep pockets, could do better but rising costs were a challenge despite local support.
“Hard decisions must be made if businesses are to survive.”
Some restaurants, including at the luxury Atlantis hotel on Dubai’s palm-shaped island, have been temporarily closed for renovations, not to mention the war. Others have opened, including the Italian restaurant Siena in early April in Dubai and Isabel Mayfair in the UAE capital Abu Dhabi.
Chefs Lash and Cheung expect the market to take off.
“In the last few weeks, especially with ceasefire and with schools continuing, we have begun to see a positive improvement in business and general movement throughout the city. There is a sense of normalcy slowly returning,” said Cheung. – Rappler.com
