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Higher costs, tighter margins: How Hormuz disruptions are testing UAE food supplies

Executives across the food, logistics and fresh produce sectors say consumers are unlikely to see widespread shortages in the immediate term

Nida Sohail
Nida Sohail

01 June, 2026

Higher costs, tighter margins: How Hormuz disruptions are testing UAE food supplies

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Article Summary
Despite Strait of Hormuz disruptions, UAE supermarkets maintain food supplies, but the import-dependent food system faces increasing pressure. Longer delivery times, rising freight costs, and port congestion are impacting cold-chain infrastructure. Alternative routes offer some relief, yet cannot fully replicate established maritime corridors. Agility and diversified sourcing are becoming crucial for businesses to manage uncertainty and maintain supply.

Food continues to arrive on UAE supermarket shelves despite disruptions linked to the Strait of Hormuz, but industry leaders warn that the system keeping products moving is operating under increasing pressure.

Executives across the food, logistics and fresh produce sectors say consumers are unlikely to see widespread shortages in the immediate term.

However, the mechanisms that support the UAE’s heavily import-dependent food ecosystem are being forced to adapt to longer delivery times, mounting freight costs, port congestion and growing pressure on cold-chain infrastructure.

Read more-Strait talk: What the Hormuz crisis means for GCC markets in Q2 2026

The consensus among industry leaders is that the challenge is no longer limited to a single shipping route. Instead, the disruption is creating a cascading series of constraints that stretch from maritime access and port operations to trucking networks, warehousing facilities and retail replenishment cycles.

While alternative routes are helping to maintain supply continuity, executives say they cannot fully replicate the efficiency and capacity of established maritime corridors that have long underpinned Gulf food imports.

Shipping access remains the root cause

According to Sven Tietz, co-founder and CEO at HeadsUp, the most critical bottleneck remains access through the Strait itself.

“The primary bottleneck remains shipping access through the Strait itself. The other constraints are second-order effects downstream of that disruption. If shipping access existed normally, the congestion and inland pressure wouldn’t exist in the same way,” Tietz said.

However, once shipping capacity becomes constrained, the pressure rapidly shifts elsewhere in the supply chain.

“That said, once you accept that maritime access is constrained, the biggest operational bottleneck by far is land transport capacity. Trucks, drivers, and overland corridor throughput are the limiting factor at the moment,” he said.

The sudden shift from maritime transport to greater reliance on land-based logistics has exposed structural limitations that are difficult to address quickly.

“We’ve essentially moved from a scalable maritime logistics system to a much narrower land-based one overnight. Global supply chains are simply not designed to move equivalent food volumes by road at short notice,” Tietz said.

As a result, while shipping access remains the underlying cause of the disruption, much of the day-to-day operational stress is now emerging across inland transport networks.

“So while the root cause is unquestionably shipping access, the day-to-day pain is increasingly showing up in inland logistics capacity,” he said.

Delivery times become less predictable

One of the most immediate consequences of the disruption has been the extension of delivery schedules across multiple food categories.

Industry executives caution that the impact is not uniform. Some products continue to move through supply chains relatively smoothly because importers and distributors entered the disruption with healthy inventory levels already positioned in warehouses.

“It’s difficult to generalise because the impact varies significantly by product category and route. Some products have continued flowing relatively normally because there was stock in warehouses. In those cases, availability has remained stable, even if pricing has moved materially,” Tietz said.

Other product categories are facing simultaneous pressure on both availability and cost.

“Other categories have been affected on both fronts: availability and pricing simultaneously,” he said.

Yet many operators say the greatest challenge is not necessarily longer transit times, but uncertainty.

“In many ways, the bigger issue for operators isn’t even the lead times. It’s the unpredictability,” Tietz said.

Hospitality businesses, restaurants and food retailers can typically adapt to stable conditions, even when costs rise significantly. What becomes more difficult is planning menus, procurement cycles and inventory requirements when product availability and pricing fluctuate continuously.

“Hospitality businesses can adapt to almost any stable environment, even an expensive one. What becomes incredibly difficult is managing operations when you don’t know what’s going to be available tomorrow, next week, or at what price,” he said.

Agility becomes a competitive advantage

The disruption is also accelerating a shift in procurement behaviour across the food sector.

Operators are increasingly seeking alternative suppliers, substitute products and multiple sourcing channels rather than relying on a single supply route.

“That’s why optionality becomes so important during periods like this. Operators need visibility not just on their incumbent supplier, but on the broader landscape of viable alternatives around them,” Tietz said.

He warned that as availability becomes more constrained, businesses will need to become significantly more agile.

“Availability will become more constrained and hand-to-mouth. The ability to quickly identify alternative products, suppliers or routes becomes operationally critical,” he said.

“In our view, operators are going to need to become far more agile and far more comfortable exploring options dynamically, rather than relying on a single fixed supply structure. The businesses that cope best will be the ones with systems and visibility that allow them to pivot quickly as supply conditions change.”

Fresh produce sector faces cold-chain pressures

For fresh fruits and vegetables, maintaining product quality during disruptions is becoming one of the industry’s biggest operational challenges.

Mohammed Alrifai, CEO of NRTC Group, said the most significant pressure point lies in preserving logistics fluidity across increasingly complex supply routes.

“The most critical constraint today lies in end-to-end logistics fluidity, particularly port congestion, vessel schedule reliability, and inland distribution synchronization,” Alrifai said.

“While farm supply remains relatively resilient due to NRTC’s diversified sourcing across more than 50 countries, the pressure points are in transit predictability and cold-chain continuity.”

He noted that maintaining temperature integrity across disrupted routes has become increasingly difficult.

“Maintaining temperature integrity across extended or disrupted routes is increasingly the defining operational challenge,” he said.

Transit times for certain fresh produce categories have already increased by several days depending on origin and routing.

“Transit times have extended variably depending on origin and route, in some cases by several days,” Alrifai said.

“This has a direct impact on highly perishable categories such as berries, leafy greens and stone fruits, where shelf-life compression is more pronounced.”

To reduce losses, companies are relying on pre-conditioning at origin, dynamic rerouting strategies and prioritised customs clearance procedures.

However, executives acknowledge that the margin for error is becoming increasingly narrow.

Perishable foods receive priority

As pressure builds, companies are increasingly prioritising products based on perishability and consumer demand.

“Yes, prioritisation is driven by perishability, nutritional importance and demand elasticity,” Alrifai said.

“Highly perishable, high-turnover items are fast-tracked through air freight or optimised sea routes where feasible, while more durable produce provides buffer stability.”

These decisions are becoming increasingly data-driven as companies weigh transit risk against shelf life and market demand.

“Decisions are data-led, factoring in shelf life, transit risk and market demand to ensure both availability and minimal waste,” he said.

Industry executives say this approach has helped maintain supply continuity even as logistics networks become more strained.

Alternative routes help — but cannot fully replace existing capacity

One of the key questions facing the industry is whether alternative transport corridors can fully offset disruption in traditional shipping lanes.

Most executives say the answer is no, at least in the short term.

“I think the answer depends heavily on timeframe,” Tietz said.

“In the short term, the ability of alternative corridors to fully compensate is probably overstated.”

He pointed to the importance of infrastructure assets such as Jebel Ali.

“Red Sea and overland Saudi corridors, or ports like Fujairah absolutely help, but Jebel Ali is one of the largest and most deeply integrated ports in the world and replacing that kind of throughput and infrastructure is not something that happens quickly,” he said.

“You can reroute some volume, but it’s more like breathing through a straw than restoring normal circulation.”

Alrifai echoed similar concerns.

“Alternative sourcing and rerouting are essential tools, but they come with trade-offs,” he said.

“While they help maintain supply continuity, they can introduce variability in product specifications, longer transit times and higher costs.”

Maintaining freshness under such conditions requires tighter coordination across suppliers, logistics providers and cold-chain operators.

UAE food security remains strong despite risks

Despite current pressures, food industry leaders say the UAE remains among the best-positioned countries globally to manage prolonged supply disruptions.

Mohamed Itani, CEO of United Foods Company, noted that the UAE imports approximately 85 per cent to 90 per cent of its food requirements from international markets, leaving it exposed to maritime disruptions.

“The UAE remains heavily dependent on imported food products, with approximately 85 per cent to 90 per cent of total food consumption sourced internationally,” Itani said.

“A significant proportion of these imports move through Hormuz-linked maritime routes.”

Staple categories including edible oils, cereals, pulses, sugar and fresh vegetables are among the most exposed.

“Poultry, dairy, eggs, meat products and processed foods are also highly exposed because any disruption in shipping routes or freight movement creates ripple effects across the broader food ecosystem,” he said.

However, he stressed that the UAE’s diversified sourcing network provides a significant buffer.

“The UAE has built one of the world’s most diversified food sourcing networks, importing products from India, Pakistan, Brazil, Australia, Europe, the US, Southeast Asia, East Africa and the Black Sea region,” Itani said.

At the same time, he acknowledged that sourcing diversification does not eliminate concentration risk within shipping infrastructure.

“This reflects an important distinction: sourcing diversification alone does not eliminate concentration risk if critical logistics infrastructure remains dependent on a limited number of maritime corridors,” he said.

Freight costs and insurance pressures build

Executives say one of the clearest impacts of the disruption is rising logistics costs.

Under prolonged disruption scenarios, freight rates, insurance premiums and rerouting expenses all increase, creating inflationary pressure throughout the food supply chain.

“Freight costs rise sharply, insurance and war-risk premiums increase, rerouting congestion develops, and supply lead times become more volatile,” Itani said.

The impact often appears first in highly perishable categories before spreading across broader food segments.

“Perishable categories are typically affected first, while feed shortages can place additional pressure on livestock and poultry supply chains,” he said.

“Over time, inflation broadens across food categories, retail variety narrows, and strategic reserves face greater replenishment pressure.”

He added that disruptions are affecting more than just food products themselves.

“With this crisis, we understand even the packaging materials and raw materials are playing a significant role apart from the food security challenges on hand,” he said.

A structural shift in food supply thinking

Beyond the immediate disruption, industry leaders believe the crisis may trigger lasting changes in how governments and businesses approach food security.

“Yes, I think so. I think we’re witnessing the beginning of a long-term shift in thinking about food routes, food sovereignty and procurement psychology,” Tietz said.

Part of that shift will involve building greater routing resilience through diversified logistics corridors.

“Routes and corridors will be diversified to reduce dependency on a single chokepoint,” he said.

“The pathways products travel will likely become more diversified over time.”

Food sovereignty is also expected to receive greater attention.

“Events like this force governments and regional leadership to confront how dependent the Gulf remains on imported food supply,” Tietz said.

He pointed to Qatar’s response during the regional blockade as an example.

“A good example from the Qatar blockade is the Baladna Dairy Project. Qatar responded by rapidly investing in local dairy supply capability, including the creation of Baladna, which flew thousands of dairy cattle into the country to establish domestic dairy production from scratch,” he said.

The final shift, executives say, will be behavioural.

“I think these events are changing procurement psychology permanently,” Tietz said.

“Operators are becoming less comfortable relying too heavily on one supplier, one route, or one system. Increasingly, resilience and optionality are becoming part of procurement strategy itself.”

For now, food continues to reach UAE shelves. But behind that continuity, industry leaders say a vast logistics network is absorbing growing pressure. As shipping routes face disruption, ports juggle congestion, and inland distribution networks stretch to accommodate new realities, the system is proving resilient, though not without cost.

India cuts export duties on petrol, diesel and aviation turbine fuel

The rates are being revised on a fortnightly basis and are based on the average international prices of crude oil, petrol, diesel and ATF

Reuters
Reuters

31 May, 2026

India cuts export duties on petrol, diesel and aviation turbine fuel

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Article Summary
India is reducing export duties on petrol, diesel, and aviation turbine fuel (ATF) from June 1st for a two-week period. The cuts, set at 1.5 rupees per litre for petrol, 13.5 for diesel, and 9.5 for ATF, are based on fluctuating average international crude oil prices. Domestic excise duties remain unchanged.

India will cut its export duty on petrol diesel and aviation turbine fuel (ATF) for the fortnight starting June 1, its government said in a statement on Saturday.

The duty on exports of petrol has been set at 1.5 rupees ($0.0158) per litre while that on diesel has been set at 13.5 rupees per litre, the statement said. Export duties on ATF have been set at 9.5 rupees per litre.

The rates are being revised on a fortnightly basis and are based on the average international prices of crude oil, petrol, diesel and ATF during the period since the last review.

There is no change in the existing excise duty rates on petrol and diesel cleared for domestic consumption.

Blue Origin faces months of delays after rocket explosion, bolstering SpaceX’s dominance

The launch pad has been “practically destroyed” and engineers expect at least a six-month disruption

Reuters
Reuters

31 May, 2026

Blue Origin faces months of delays after rocket explosion, bolstering SpaceX’s dominance

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Article Summary
Blue Origin's launch pad suffered significant damage after a rocket test explosion, potentially delaying New Glenn launches by at least six months. This setback jeopardises Amazon's satellite deployment schedule and could complicate NASA's lunar plans. SpaceX gains a competitive advantage, though a multi-provider launch ecosystem is still desired.

Blue Origin faces a months-long setback after the explosion of a rocket damaged its launch pad, company and industry sources said, scrambling schedules for Amazon satellite launches and bolstering SpaceX’s dominance in the commercial launch market.

The mishap, which occurred during a test fire of the engines for the New Glenn rocket’s launch next week, comes at a critical time for Jeff Bezos’ business empire.

His companies Blue Origin and Amazon are seeking to establish themselves as viable challengers in the heavy-lift and global satellite internet network industries, competing with Elon Musk‘s SpaceX.

Thursday’s setback could also complicate NASA’s lunar ambitions.

A Blue Origin booster called “No, It’s Necessary” – a nod to a line from the film Interstellar – was wrecked in the incident on Thursday. The launch pad was “practically destroyed” and engineers expect at least a six-month disruption, if not longer, said a person familiar with the matter who declined to be named because they are not authorized to speak with media.

“It’s only been a year since the SpaceX Starship also exploded on the launch pad and Blue Origin can also recover. But it will take months to rebuild,” said Antoine Grenier, partner and head of space consulting at Analysys Mason.

Months-long rebuild expected

After a Falcon 9 exploded on the launch pad in 2016, SpaceX spent more than a year repairing the damaged facility, though it resumed launches within 4-1/2 months by shifting operations to a second Florida pad.

While Amazon’s decision to bring aboard more launch partners, including SpaceX, has reduced its dependence on any single rocket, it gives Musk‘s business leverage over Bezos, his long-running rival.

“Sorry to see this, I hope you recover quickly,” Musk said in a post on X, later replying to Bezos with “Ad astra per aspera,” a Latin phrase that speaks to overcoming impossible goals.

Amazon LEO was relying on New Glenn’s rapid launch cadence to deploy half of its more than 3,200 satellite broadband constellation by July 2026 to meet regulatory deadlines. An extended grounding by the FAA will severely threaten the timeline.

Constellation deployment in jeopardy

Analysys Mason’s Grenier said Amazon has already tapped much of the near-term capacity available from other heavy launch providers. While SpaceX could absorb some additional demand, its Falcon 9 rocket can carry roughly half as many Amazon LEO satellites per launch as New Glenn, meaning any major shift of launches could require a significant increase in mission count, he said.

As well, lunar payloads are designed around specific launch vehicles, making a switch to an alternative rocket complicated.

The rocket was also scheduled to launch Blue Origin’s first Blue Moon lunar lander later this year. Days earlier NASA awarded the company a contract to deliver two lunar rovers ahead of the Artemis 4 mission in 2028.

The space agency said on Thursday it would assess near-term impact on its Artemis and Moon Base programs, though it remains unclear whether any missions would need to be reassigned.

Still, it is yet to be seen how much of a setback the incident is to Blue Origin’s long-term prospects and a gain for SpaceX, whose order book is crowded with its own Starlink satellite deployments, alongside commercial and government missions.

The US Space Force and National Reconnaissance Office on Friday affirmed their commitment to Blue Origin, standing by a newly awarded national security launch contract on Thursday despite the catastrophic launch pad explosion of the company’s New Glenn rocket just hours later.

“Long term, the market still needs viable alternatives, so this strengthens SpaceX’s position at the margin, but doesn’t change the broader trajectory toward a multi-provider ecosystem,” said Mark Boggett, CEO of British space investor Seraphim Space.

First Windows PC powered by Nvidia chips to debut next week — report

Nvidia-powered computers are expected both from Microsoft’s Surface brand as well as other computer makers including Dell

Reuters
Reuters

31 May, 2026

First Windows PC powered by Nvidia chips to debut next week — report

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Article Summary
Nvidia and Microsoft are poised to unveil Windows PCs powered by Nvidia chips at Computex and Build. This signals a shift towards more energy-efficient designs, mirroring Apple's success with its own chips. Microsoft will also debut AI software for local task execution. This move challenges Intel and AMD's dominance in Windows CPUs.

AI chip firm Nvidia and Microsoft are expected next week to debut the first Windows PCs that use Nvidia’s chips as the main processor, Axios reported on Saturday, citing sources.

Nvidia-powered computers are expected both from Microsoft’s Surface brand as well as other computer makers including Dell.

Microsoft’s efforts to shift to more battery-life-friendly chips have yet to drive a significant sales boom. Its primary rival Apple, which uses its own chips, unveiled updated MacBooks featuring its latest M5-series chips in March.

Microsoft and Nvidia will unveil the new PCs at the Computex trade show in Taiwan and Microsoft’s Build developer conference in San Francisco, the report said.

Nvidia did not respond to a request for comment. Microsoft declined to comment.

The official X accounts of Windows, Nvidia and chip design firm Arm all teased an upcoming announcement on Friday, announcing “A new era of PC,” along with what appeared to be coordinates in Taiwan’s capital Taipei.

Reuters first reported in 2023 Nvidia’s plans to design CPUs that would run Microsoft’s Windows OS and use technology from Arm.

Qualcomm currently makes Arm-based CPUs for Windows laptops, while Intel and AMD remain the dominant suppliers of CPUs for Windows laptops.

Microsoft is also expected to debut software aimed at enabling AI agents to perform tasks locally on Windows computers, according to the Axios report.

Ebola alert: UAE urges residents to avoid non-essential travel

As part of the UAE’s ongoing commitment to protecting citizens abroad, MoFA stressed the importance of following all official travel advisories and guidance

Nida Sohail
Nida Sohail

31 May, 2026

Ebola alert: UAE urges residents to avoid non-essential travel

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The UAE has advised its nationals and residents to avoid non-essential travel to Uganda, the Democratic Republic of the Congo and South Sudan as authorities continue to closely monitor regional developments related to Ebola virus disease (EVD).

The Ministry of Foreign Affairs (MoFA) issued the advisory on Friday, May 29, citing the evolving public health situation linked to the virus in parts of Africa. The Ministry urged UAE nationals and residents to refrain from travelling to the affected countries unless absolutely necessary, a WAM report said.

Read more-New Ebola advisory issued: Emirates, Oman issue travel rules

As part of the UAE’s ongoing commitment to protecting citizens abroad, MoFA stressed the importance of following all official travel advisories and guidance. The ministry also called on UAE nationals currently in the affected countries to exercise the utmost caution and adhere to health and safety instructions issued by local authorities.

In addition, citizens were urged to register with the Twajudi service and contact the Ministry in emergency situations through the dedicated hotline for UAE nationals abroad at +97180024.

Authorities review national preparedness

The travel advisory comes as the National Emergency Crisis and Disaster Management Authority (NCEMA) and the Ministry of Health and Prevention reviewed the latest regional and international developments concerning the Ebola virus as part of ongoing efforts to maintain a high level of public health readiness.

The review was conducted during a coordination meeting chaired by Ahmed Ali Al Sayegh, Minister of Health and Prevention, in collaboration with NCEMA and attended by relevant government entities and strategic partners.

Officials examined current epidemiological developments and assessed the UAE’s preparedness measures, including the country’s capability to detect and respond to any suspected or confirmed Ebola cases in line with approved health protocols.

The meeting also reviewed progress on previously agreed actions, with a focus on strengthening coordination among relevant authorities and ensuring preparedness measures continue to meet national response requirements.

Public health situation remains stable

Discussions further covered precautionary procedures at airports, aviation-related health protocols and the readiness of institutional quarantine facilities operated by local health authorities, where required.

Officials also reviewed public awareness and communication plans aimed at providing residents with timely, accurate and reliable information through official channels.

NCEMA and the Ministry of Health and Prevention confirmed that the public health situation in the UAE remains stable. They emphasised that the country’s health preparedness and response systems remain active and effective, while authorities continue to closely monitor developments to safeguard public health and community safety.

UAE motorists to pay more as petrol prices rise again for June

Super 98 climbs to Dhs3.95 a litre as motorists face a third straight monthly increase

Gareth van Zyl
Gareth van Zyl

31 May, 2026

UAE motorists to pay more as petrol prices rise again for June

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Article Summary
The UAE will see increased petrol prices in June 2026, marking the third consecutive monthly rise. Super 98 will cost Dhs3.95 per litre. Special 95 and E-Plus 91 will also increase. Diesel prices, however, will decrease. These changes reflect global oil market movements since deregulation in 2015, impacting household budgets.

The UAE has announced higher fuel prices for June 2026, with motorists set to pay more at the pump from June 1 as petrol prices continue their upward trend.

Super 98 petrol will cost Dhs3.95 per litre, up from Dhs3.66 in May, while Special 95 will rise to Dhs3.83 from Dhs3.55. E-Plus 91 will increase to Dhs3.76 from Dhs3.48.

Diesel, however, will fall to Dhs4.33 per litre, down from Dhs4.69 in May.

The latest revision marks the third consecutive monthly increase in petrol prices, reflecting broader movements in global oil markets.

For motorists, the latest increases will place added pressure on household budgets, with fuel remaining a regular monthly expense for many families. Even relatively small monthly price increases can have a noticeable impact on overall transport costs, particularly for daily commuters.

Super 98 has risen sharply this year, climbing from Dhs2.45 per litre in February — the lowest level recorded in 2026 so far — to Dhs3.95 in June.

The price trajectory has accelerated in recent months. Super 98 stood at Dhs2.53 in January before dipping to Dhs2.45 in February. It then rose to Dhs2.59 in March, jumped to Dhs3.39 in April, climbed again to Dhs3.66 in May and has now reached Dhs3.95 for June.

Diesel prices, by contrast, have eased this month, offering some relief to commercial operators and logistics firms.

The UAE has linked domestic fuel prices to average global oil prices since August 2015, when the government deregulated the sector and removed subsidies, exposing local pump prices to international market fluctuations.

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