An Invitation to Join the Halal Supply Chain Alliance: A Collaboration Platform for Halal Supply Chains

By Dr. Marco Tieman, Co-Founder and Chief Executive Officer at HSC Alliance Sdn Bhd

Background

The halal industry is a multi-trillion US dollar sector, encompassing food, cosmetics, pharmaceuticals, and modest fashion. Halal requirements are shifting from a product-based approach towards a halal supply chain and value chain approach. This transition is being driven by regulatory developments in Muslim-majority countries as well as increasing consumer demand.

Muslim consumers are progressively insisting that halal integrity extends beyond the factory, encompassing the entire supply chain, similar to food safety and cold chain management. Additionally, there is growing interest in ensuring that businesses operate in accordance with Islamic values. Consequently, brands that align their operations with these values stand to gain consumer trust and loyalty.

Indonesia is implementing stringent halal regulations, making halal certification mandatory for supply chain actors in the food sector (from October 2024), cosmetics (by October 2026), and pharmaceuticals (phased from October 2026 onwards). It is anticipated that other Muslim-majority countries will introduce similar regulatory policies by 2030.

However, maintaining halal integrity throughout the supply chain is not as straightforward as it may seem. Collaboration is essential to achieving truly end-to-end halal supply chains.

Halal Cold Chain Initiatives

Halal requirements are particularly relevant to cold chains, which are critical for halal food and pharmaceutical supply chains. Some logistics service providers have already introduced halal-certified cold chain solutions, featuring dedicated halal cold storage facilities. Pioneering examples include:

• Malaysia: MISC Integrated Logistics (Port Klang)
• Indonesia: IPC Logistic (Tanjung Priok)
• Singapore: SATS Coolport (Changi Airport)
• The Netherlands: Eurofrigo (Port of Rotterdam)
• Belgium: Port of Zeebrugge

In addition to halal-certified cold storage facilities at sea and airports, there is a growing need for halal cold storage hubs near urban centres. These hubs would facilitate last-mile distribution of halal products to retail, HORECA (hotels, restaurants, and café/catering), and e-commerce consumers. Some transport companies in both Muslim and non-Muslim countries already provide halal-certified cold transportation, using dedicated halal-only refrigerated trucks.

However, there are fewer halal-certified cold storage facilities for pharmaceuticals, even in Muslim-majority countries with well-developed halal standards such as Malaysia and Indonesia. Halal pharmaceuticals is a highly specialised sector with stringent regulatory requirements. As a result, developing end-to-end halal pharmaceutical cold chains will take time but presents significant opportunities for cold chain solution providers.

Challenges in Current Halal Supply Chains

Halal logistics solutions have largely been developed as independent initiatives by local logistics service providers, later followed by multinational logistics firms. These efforts have been based on general halal supply chain management standards, leading to inconsistent halal logistics practices and varying standard operating procedures, even within the same country.

As most supply chains operate on an international scale—even for products as simple as bread—this inconsistency creates significant challenges. The lack of uniform halal supply chain practices, particularly in sectors such as airfreight, sea freight, and e-fulfilment, results in unpredictable halal integrity performance.

This issue poses problems for multiple stakeholders:

• Muslim consumers, who demand products that are unquestionably halal.
• Brand owners, who must safeguard the halal integrity of their products and supply chains while protecting their corporate halal reputation in OIC (Organisation of Islamic Cooperation) countries.
• Halal certification bodies, which are responsible for guaranteeing the halal integrity of certified products.
• Governments in OIC countries, which must ensure access to and protection of halal products for their Muslim populations.

Greater collaboration is necessary within the halal industry, both through vertical collaboration (within brand owner or retail supply chains) and horizontal collaboration (between different halal supply chains).

Halal Supply Chain Alliance

HSC Alliance Sdn Bhd is an organisation recently established in Malaysia to create an international halal supply chain network, harmonise halal supply chain protocols, and promote halal supply chain excellence.

Through horizontal collaboration programmes, HSC Alliance aims to build international halal supply chain networks, offering synergy benefits to brand owners, retailers, and logistics providers. The alliance serves as a collaboration platform by and for the halal industry, ensuring the harmonisation of halal supply chain protocols.

Later this year, we are launching our first collaboration initiatives. We invite halal food, cosmetics, and pharmaceutical producers, as well as logistics service providers, to join us in achieving end-to-end halal supply chains.