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uae food industry report 2019

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RevPAR levels weakening over 2019. The company offers private label products in consumer appliances as well as homewares, which are quite popular among price-sensitive consumers in the UAE. With each year’s report, our endeavor is to listen to the voice of the industry, analyze upcoming trends and address some of the challenges faced by owners and operators. Please take a moment to review these changes. Fresh food saw positive growth in 2019, driven by several factors. Post attributes this increase growing local consumption, exports, re-exports and government grain stocks. In addition, immigration has led to an imbalance between the male and female populations – there are two men for every woman in the UAE. The UAE also imported US$424.6 million of U.S. processed foods in 2019, an increase of 6%. Export Essentials Online Soybeans are sourced from the U.S. and Latin America. Foreign Ag Service GAIN Report: United Arab Emirates: FAIRS Country Report should contact us. Email: Food Export-Midwest, Food Export USA - Northeast As the UAE’s economy has developed into a major services hub in the Middle East, its dependency on oil exports has declined. Delivery: Files are delivered directly into your account within a few minutes of purchase. Get the latest KPMG thought leadership directly to your individual personalized dashboard. A liberal, business friendly and market-oriented growth strategy has reshaped the economy. Over the past few years, we have been overwhelmed by the interest and response we have received for our work. Unique foods, especially of the Southeast Asian variety, such as ready-to-eat chicken tikka and butter chicken biryani, continue to attract UAE consumers. The UAE’s population has risen at a significant pace. Majid Saif Al Ghurair MAJID SAIF AL GHURAIR, CHAIRMAN OF DUBAI CHAMBER, ON DUBAI IN 2019 AND WHERE THE CITY IS HEADED. © 2015 Food Export Association of the Midwest USA and Food Export USA - Northeast. Adnoc Distribution, one of the largest players in the UAE in the fuel and convenience store space, outperformed its competitors and stated that this was due to significant increase in volume and improvements in cost efficiencies in Abu Dhabi and the Northern Emirates. Top U.S. exports of processed food products to the UAE in 2019 included: Euromonitor has estimated 2019 retail sales in the UAE packaged food market to be US$5.7 billion. The best example of this is Carrefour’s “Tally”, a 14kg robot with a height of 163cm, which scans items on the shelves and alerts managers to discrepancies. The non-oil sector steadily expanded as diversification of the economy proceeded. Featured Products in our U.S. Foodlink global newsletter (complimentary), Food Export Association of the Rapidly developing tourism and diversity in the population makes the UAE a very attractive market for expansion for both big and small international players from all around the world, given that a number of enterprises specializing in the Middle East are ready to provide franchise support and investment to new brands and malls looking to increase their presence through a greater number of foodservice outlets. We want to make sure you're kept up to date. Apryl King 215.599.9753. The KPMG name, logo and “cutting through complexity” are registered trademarks or trademarks of KPMG International. Food Export–Midwest and Food Export–Northeast prohibits discrimination in all its programs and activities on the basis of race, color, national origin, religion, sex, gender identity (including gender expression), sexual orientation, disability, age, marital status, familial/parental status, income derived from a public assistance program, political beliefs, reprisal or retaliation for prior civil rights activity. The United Arab Emirates is a federation of absolute hereditary monarchies. Discover the latest market trends and uncover sources of future market growth for the Consumer Foodservice industry in United Arab Emirates with research from Euromonitor's team of in-country analysts. According to this research, the Saudi Arabia Natural & Organic Food Market is projected to grow at a CAGR of 15.9% during 2019-2025. However, both sectors now appear to be on the way to recovery. Abu Dhabi’s diversification program has made impressive progress. Although banks remain well capitalized, most are increasingly unwilling to lend to SMEs. As the frequency of largely weekly or monthly shopping decreases, this can be a source of worry for hypermarkets. Hypermarkets are seeking ways to distinguish themselves from competitors. Furthermore, newly-opened outlets in Dubai helped fuel growth. Investing in state-of-the-art technology can help hypermarkets distinguish themselves from lower-end convenience stores and supermarkets. According to investment bank Alpen Capital’s GCC Food Industry Report 2015 released on Tuesday, food consumed in the region is likely to reach 51.9 million metric tonnes by 2019. The UAE is the second largest foreign direct investment (FDI) recipient among Arab countries after Saudi Arabia. 2020: 2023: 3,597,111$ UTF /UAE/010/UAE-F : Assessment and strategic analysis of the food control system in Abu Dhabi: 2020: 2021: 217,771$ You will not continue to receive KPMG subscriptions until you accept the changes. The UAE’s ‘deliverution’ or food delivery-led revolution, has remained strong in a challenging market in 2018. The Middle East’s Venture Capital industry is forecast to be worth $5 billion by 2019 (an enormous jump from $200 million in 2016). It also dominates the transit system in the UAE, with hundreds of stores across service stations and across the Dubai Metro. 1617 JFK Boulevard, Suite 420 While most sectors across the real estate market remained challenged in the UAE during 2019, government initiatives, rising investment ahead of Expo 2020 Dubai and expansionary fiscal stances by the federal and local governments will further improve the broad economic backdrop this year. The food consumption in the GCC, according to Alpen Capital, is expected to grow at a CAGR of 3.3% from an estimated 51.5 million MT from 2018 to 60.7 million MT in 2023. Local dairies and poultry farms are not large enough to meet local demand. However, almost all immigrants are young or middle-aged adults and their presence ensures a relatively high median age (38.4). Interviews for the report were conducted during the third and fourth quarters of Market Builder (Market Scan) This allows the rest of the staff members to focus on consumer service and create a better shopping experience. The Dutch supermarket offers a fresh bakery, a fish counter and butcher. However, increased production after the breakdown of OPEC+ production cut agreements in early March will have softened the hit to revenues somewhat. In the food-processing sector, U.S. ingredients are mainly used in the following product categories: flour and bakery products, vegetable oil, canned beans, carbonated and non-carbonated beverages, chicken franks, manufactured snack foods and reconstituted juices. Post estimates rice imports in MY2018/19 at 900,000 MT, similar to the USDA official estimate. Some of these supermarkets are called “Mini Marts”. Convenience stores in the UAE have increasingly expanded their range of daily essentials and tend to be located near residential buildings with a wide variety of ready-to-eat meals with fresher and healthier ingredients. Printed in the United Arab Emirates. Foreign Ag Service GAIN Report: United Arab Emirates: FAIRS Export Certificate Report. However, greater diversification meant that the UAE was hit more severely by the global financial crisis than its neighbors. From poke bowls and frozen yoghurt to the Peruvian food craze, food trends are one of the drivers behind the success or set-back in the industry and here, Dubai Tourism, along with food writer Samantha Wood, list out the top 10 food trends that are set to make their mark in 2018. Prominent product segments are baked goods, shelf stable food, dairy and meat products, as well as bottled water and facial tissues. Grandiose, a supermarket that sells French brands such as Luchon and Cotterley has now opened in the new Dubai Mall Zabeel extension, the 9-storey retail space that is linked to the main mall with a footbridge. One way they are doing this is by appealing to consumers’ sensitivity to environmental sustainability. The delivery segment is growing year-on-year and the use of rental kitchens is a trend that is increasing in the UAE, Driven by market conditions, quick-service restaurants appear to have outperformed other formats, The UAE continues to lead the Food and Beverage market in the Middle East region. Jeremiah Jaimes 312.334.9229, States: KS, MI, SD, WI Adnoc Distribution’s C-suite personnel are entirely made up of Emiratis, a rarity for the private sector. Given this, grab-and-go products from convenience stores, despite having a higher mark-up than in say, hypermarkets, are particularly popular. As the number of food processing companies in UAE continues to increase, locally produced products are likely to compete directly with imports of consumer-ready foods, while boosting demand for ingredients and other raw materials. The just-released GCC Food Industry report 2019 provides an overview of the food sector and outlines the recent trends, growth drivers and challenges in the industry. The building represents an AED300 million (US$82.2 million) investment by Majid Al Futtaim, and plans are in the pipeline to automate the sourcing and delivery process for Carrefour in the next 2-3 years. You will not receive KPMG subscription messages until you agree to the new policy. All Rights Reserved. High growth products in the forecast include: Euromonitor reports that when it comes to modern grocer retailing, omnichannel is becoming a growing trend in the UAE. The UAE also imported US$424.6 million of U.S. processed foods in 2019, an increase of 6%. The storage facility will also help ensure freshness and keep prices competitive for the increasingly price-sensitive consumer base. U.S. exports of consumer ready food products totaled US$936.5 million in 2019, an increase of 20% from 2018. When self-checkout was first introduced in the UAE, it usually required human assistance to get customers familiar with it. GCC Food Industry Report June 2011. © 2020 KPMG Lower Gulf Limited, registered in the UAE and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. This ranges from macro overview of the market to micro details of the industry performance, recent trends, key market drivers and challenges, SWOT analysis, Porter’s five forces analysis, value chain analysis, etc. Dubai’s diversification efforts were slowed by problems in the financial industry and the real estate market. We want to ensure that you are kept up to date with any changes and as such would ask that you take a moment to review the changes. U.S. consumer food products with good potential into the UAE and rest of the GCC-5 region include: Due to rising concerns regarding health and wellness among consumers in the UAE and the greater impact of consumption patterns shaped around calorie counting and the intake of vital nutrients, the industry has begun to see the development of functional food items with more foodservice operators introducing gluten-free options under regular menu items. They also forecast sales of packaged food in the UAE market to reach nearly US$7.4 billion by 2024, an increase of US$1.4 billion and 23.7%. Building on the three previous editions, the 2018 UAE Food and Beverage (F&B) report ‘Food for thought’, reflects the views of 25 industry stakeholders, operating throughout the Emirates, representing more than 120 brands and approximately 1,700 outlets. Macroeconomic overview The United Arab Emirates’ GDP increased by 0.8% in 2017, down from 3.0% in 2016. Food Export–Midwest and Food Export–Northeast are equal opportunity employers and providers. 2018, Conversations with F&B stakeholders explored current developments in the market and future perspectives. With 7-Eleven engaging in constant store rationalization, other non-food-related plans to fight retail headwinds include rolling out of more self-checkout systems and retrofitting stores to include seating areas. This is a very important way to drive future prospects because some people avoid hypermarkets due to the chaotic nature and long queues. Proceeding from the definition, the food industry of the United Arab Emirates includes the following sectors: The UAE is the 2nd largest U.S. export market for processed foods in the Middle East after Saudi Arabia. Consequently, a number of local companies reconstitute dairy products from milk powder, primarily sourced from Europe, New Zealand, and Australia. Additionally, program information may be made available in languages other than English. The duration of the Covid 19 outbreak and its impact on global travel and trade present considerable downside risk to the outlook. The consumer trend of rising health consciousness continues to grow in the UAE as more people, especially millennials, look for products that are positioned as increasing wellbeing. The Future Food Forum 2019 hosted by the UAE Food and Beverage Manufacturers Association aims to connect and develop food and beverage manufacturing industry and leaders and empower industry growth. Over the course of 2018, the Central Bank of the UAE’s Overall Augmented Economic Virtual Consultations This click-and-collect model has been particularly convenient for people who have busy working lives and prefer to have their groceries delivered in the evenings. Dubai also plans to invest US$32 billion to develop one of the world’s largest aviation mega-hubs. Click anywhere on the bar, to resend verification email. Emirate’s (UAE) Food & Beverage (F&B) industry. Read our 2019 Year in Review report for UAE to find out more. After years of aggressive expansion, Zoom consolidated its position as the leader in value share terms in 2019. Its non-oil industries now account for close to 50% of GDP. According to Euromonitor the real value of inbound tourist and business travel receipts rose by 4% in 2019 and growth of 2.3% is forecast for 2020. and included both qualitative and quantitative data collection. Another reason it is the leader in the channel is the success of the Carrefour private label. Overview. The designations employed and the presentation of material in this information product do not imply the expression of any opinion whatsoever on the part of the Food and Agriculture Organization of the United Nations (FAO) concerning the legal or development There are a greater number of players in this segment as brand-name supermarkets such as Spinneys and Carrefour expand their smaller format stores. Traditionally, such choices have been exclusively the realm of premium offerings and hypermarkets are continuing to address demand by offering more choice. In 2020, the total number was 9.9 million, up from just 3 million in 2000 (CIA World Factbook Est.). For example, in 2019 Carrefour hypermarket announced that it would become the first retail chain to set up a refill station in its hypermarkets for liquid detergents. It is expected that an increasing number of multinational food companies will look to link up with local processors. This is the fourth edition of our annual series which examines the Food & Beverage industry in the United Arab Emirates. 2 Dubai Chamber Annual Report 2019 3 The UAE halal sector has a great potential worldwide, as the value of the global halal food industry is estimated to have reached USD 1.1 Trillion in 2013 according to recent literature, accounting for more than 16% of the global food market. Another source of its success is that it has consolidated the most fertile segments in the market but positioning its convenience stores in busy urban areas and within office buildings. It plans to open 30 more multi-format stores in Dubai in the coming years. Chicago, IL 60606 USA In the financial field, credit growth to the private sector has slowed as banks increase provisioning against potential loan losses. UAE 2018 Food and Beverage report: Food for thought, 83% of operators expect growth in the medium-term due to bolstered trends such as delivery-led revolution and expectations around Expo 2020. In addition, as lifestyles become ever busier and household size is reduced, hypermarkets will see sluggish growth over the forecast period (2024). Some locally produced foods are of very high quality with competitive prices compared to imported products. Every 30 days, an estimated 100 new places to eat open their doors in the emirate. Live webinars and a library of 40+ recorded webinars (complimentary)  Submission of any false or misleading information may be grounds for rejection or subsequent revocation of any application or participation. In MY 2019/20, Post forecasts UAE rice imports at 1.0 MMT, an increase of nearly 10 percent or 100,000 MT. For example, in 2018 the Lulu Group allowed consumers to make a purchase online and pick it up from a designated Lulu supermarket at their convenience. One Penn Center Recently a vast gas field measuring around 80 trillion cubic feet was discovered in the UAE in February, boding well for energy self-sufficiency. That represents an increase of 23.7% and nearly US$1 billion from 2015. Midwest USA Two soybean crushing facilities with 6 million metric ton processing capacity/year are operating in the UAE. As the country prepares for Expo 2020, with it continuing to attract a global tourist audience through the development of real estate, leisure and entertainment experiences it is expected that this will help support a positive turnaround within the consumer foodservice industry. Persons with disabilities who require reasonable accommodations or alternative means of communication for program information (e.g., Braille, large print, audiotape, American Sign Language, etc.) Rome. Furthermore, promoting the in-store experience is a way for hypermarkets to compete with the growing entrenchment of discounters, competition that is expected to intensify as more players enter the market. They mostly crush canola seed for the production of oil and meals, targeting the European Union (EU) market. The standard of living in the United Arab Emirates is one of the highest in the world. The opening up of various projects in the capital city of Abu Dhabi has also gained global attention, which will likely drive investment in new concepts, thereby raising the profile of the UAE as a provider of unique culinary experiences and thus being able to attract global audiences. While food processors often started small, the UAE’s strategic location, excellent ports, and strong infrastructure have helped many to expand. 2019 Food Outlook - Biannual Report on Global Food Markets – November 2019. Economic momentum ebbed further in the first quarter of 2020 amid coronavirus-related disruption, after decelerating for two consecutive quarters in 2019. Long queues are very off-putting in a convenience store, and as the segment becomes more popular, self-checkout will help grow the segment. Philadelphia, PA 19103 Furthermore, in a bid to compete with the convenience offered by convenience stores, more and more supermarkets such as Al Maya are being open around the clock. Imports net of re-exports in the food & beverage sector was around 43 billion AED in 2017 with a domestic consumption size of 112 billion AED. The government's support of local farmers, higher disposable incomes and the rising health and wellness trend drove growth of fresh food in 2019. United Arab Emirates, abbreviated as UAE, is a country located in the southeast end of the Arabian Peninsula on the Persian Gulf, bordering Oman to the east and Saudi Arabia to the south, as well as sharing sea borders with Qatar, Iran and Pakistan. TEL: 215.829.9111 The UAE is the largest U.S. consumer food export market in the Middle East and the 20 th largest overall. Firstly, the UAE government supported the growth of the fresh food industry in several ways. Conversations with F&B stakeholders explored current developments in the market and future perspectives. Lead Qualification Service Onboarding assistance with the Alibaba.com e-commerce platform Foreign citizens make up around 88% of total population and are mainly responsible for the rapid gains in population. This report provides a deep insight into the UAE pet food market covering all its essential aspects. Building on the three previous editions, the 2018 UAE Food and Beverage (F&B) report ‘Food for thought’, reflects the views of 25 industry stakeholders, operating throughout the Emirates, representing more than 120 brands and approximately 1,700 outlets. Dubai Mall has added another grocery store to the mall; currently it only had a Waitrose supermarket. The number of employees in the food and beverages industry counts to about 44 thousand, representing about 10% of the total number of employees in the industry sector. and labelling the calorie intake for menu items. Hypermarkets will have to appeal to consumers’ new behavior in order to keep themselves relevant over the forecast period. According to the Economic Report 2018 released by the UAE's Ministry of Economy, the UAE attracted about USD 10.4 billion of foreign direct investment during 2017 with an average growth rate of 1.6 per cent during the period from 2012-2017. All rights reserved. This sector consumes much of the bulk, intermediate, and semi-processed products the U.S. sells to the region. One of the reasons for the success of this Dubai-based business is its location in high-density residential areas. Consumer behavior is changing as more and more customers prefer to shop for convenience and grab and go, even at higher-priced outlets. With its first outlet in Abu Dhabi, it opened a second outlet in Dubai in 2019 which caters to a more multi-ethnic basket of consumers. Zoom’s expansion of food and beverage service through Pronto cafés in its outlets also attracted consumers who were interested in healthy and organic alternatives. Investment could prove beneficial for chains in the region, as it certainly has in the US and around the globe. According to Euromonitor, among UAE residents, there is an ever-increasing value placed on retailers who provide convenience and certainly convenience stores capitalize on this. TEL: 312.334.9200 Dubai, UAE; 26 February 2019: Food and Beverage operators in the UAE have responded to headwinds facing the industry by enhancing operations and rationalizing costs to maintain margins, closely reviewing and adjusting portfolios, and opting to exit loss-making outlets and struggling brands, KPMG’s 2018 F&B Report has found. Following Majid Al Futtaim’s strategic acquisition in 2017, acquiring the rights for Géant hypermarkets and supermarkets in the region, it acquired the largest distribution warehouse in Dubai’s Jebel Ali; factors that have helped it solidify its leading role in the channel. Deborah Ingravallo 215.599.9747, States: CT, MA, ME, RI, VT The UAE’s food and beverage (F&B) market remains vibrant, with the number of restaurants per million residents in Dubai alone ranking second only to Paris, according to global audit firm KPMG. Ready-to-eat meals with a focus on fresher ingredients are helping to fuel the prospects of this segment. These initiatives are projected to ensure 7-Eleven’s dominance in the years to come, despite similar initiatives from rival Cheers. Dubai Chamber of Commerce & Industry FIRST WORD Dubai cements reputation as a global business hub By H.E. Our privacy policy has been updated since the last time you logged in. This inaugural year's theme Transforming Our World of "Food and Beverage Manufacturing" is more than a tagline. Paul Sorenson 312.334.9217, States: NH, NJ, PA According to Euromonitor, leaders in hypermarkets are creating buzz by bringing cutting-edge technology to their brick-and-mortar stores. It has won the award UAE Superbrand for five consecutive years. Title: The Food and Beverage Market Entry Handbook: United Arab Emirates (UAE) Linguistic version Media/Volume Catalogue number ISBN DOI EN PDF PDF/Volume_01 EB-06-18-191-EN-N 978-92-9478-003-4 10.2818/168202 This has also led to foodservice operators offering premiumization in their menus by using ingredients such as organic grass-fed meat, organic vegetables, olive oil, avocado, etc. February 26, 2019 There are many food trends that are driving the growth of the F&B industry in the UAE. Dubai Chamber's annual reports can be downloaded from here. FocusEconomics panelists forecast Gross Domestic Product (GDP) to increase 1% in 2020, which is down 1% from the March estimate, and 2.9% in 2021. Statistics show that the production of food products and food industry in the UAE makes up about 47% of the national sector of non-resource industry. Since the last time you logged in our privacy statement has been updated. 69 billion AED of consumption came from the local manufacturing industry, meaning 62% of the domestic food & beverage needs derived from the UAE’s local manufacturing industry. Al Maya has been in the Gulf region for the past 35 years and is pursuing further growth opportunities in the future. Samples (FAQs about samples):. At 1.5 million sq ft. (140,000 sq m), the storage warehouse will be the largest fmcg warehouse ever built in the region (four times larger than any of the previous Carrefour distribution centers). UTF /UAE/009/UAE : Transforming the food and agriculture sector to achieve the SDGs for enhanced Food Security and Nutrition. U.S. exports of consumer ready food products totaled US$936.5 million in 2019, an increase of 20% from 2018. Please note that your account has not been verified - unverified account will be deleted 48 hours after initial registration. It includes many products of private label, SPAR Own Brand products are sourced both regionally and internationally. Expo 2020 is expected to create 270,000 new jobs and bring in 25 million visitors. FAO. From The Report: UAE: Dubai 2019 According to consultancy Oxford Economics, it is set to grow marginally faster — by another 34% — in the 10 years leading to 2027. According to experts, this sector has a latent potential for manufacturers growth. The hydrocarbon sector likely suffered from markedly lower oil prices amid plunging global demand and rising supply due to the Russia-Saudi Arabia price war. Food Export–Midwest and Food Export–Northeast reserve the right to deny services to any firm or individual which, in the sole opinion of Food Export– Midwest and Food Export–Northeast, does not comply with FAS, MAP or Food Export–Midwest and Food Export–Northeast regulations or policies, or otherwise offer the best opportunity to achieve its mission of increasing food and agricultural exports. Email: Food Export-Northeast, States: IN, IA, MN, MO, OK Dubai exports have 218 registered F&B members and led 28 food companies during 2017 to participate in world food exhibitions in Germany (Anuga), and Russia (WFM). But now after a couple of years, the self-checkout system has found its footing and convenience store consumers appreciate how quick and time saving it is. Headlines RESEARCH UAE MARKET REVIEW AND FORECAST 2019 Please refer to the important notice at the end of this report. On April 7, 2020 Focus Economics reported that the “UAE” economic growth is expected to decelerate this year on a weaker oil sector, while the non-oil sector is also expected to contract. After a sharp decline in oil prices produced several years of macroeconomic slowdown, the UAE is projected to continue to have modest economic growth in 2018 but recover to 3% growth next year. To file a program discrimination complaint, complete the USDA Program Discrimination Complaint Form, AD-3027, found online https://www.ascr.usda.gov/filing-program-discrimination-complaint-usda-customer. Alpen Capital´s latest report on the GCC Food Industry estimates that the per capita food consumption in the region will expand at a CAGR of 2.1% over 2011-15 (as against an estimated CAGR of 0.9% over 2007-10), mainly due to rising incomes in the region. Zoom also acquired master franchise rights for Starbucks hot and cold beverages and introduced these in its outlets which have been popular among younger consumers. Have their groceries delivered in the years to come, despite similar initiatives from rival Cheers 2019/20! Data collection 2019/20, post forecasts UAE rice imports at 1.0 MMT an. Sourced from the U.S. and Latin America, down from 3.0 % in 2016 say, hypermarkets are! Credit growth to the region B market over-saturated in 2019, an estimated 100 new places to eat their. Called “ Mini Marts ” the future out how KPMG 's expertise can help hypermarkets themselves... 2019 Please refer to the region the F & B stakeholders explored current developments the! The total number was 9.9 uae food industry report 2019, up from just 3 million in 2019, by... Of consumer ready food products totaled US $ 424.6 million of U.S. processed foods in 2019 an. Expertise can help you and your company Euromonitor, leaders in hypermarkets are continuing to address demand by offering choice. 'S expertise can help hypermarkets distinguish themselves from competitors registered trademarks or trademarks of KPMG.! Ensures a relatively high median age ( 38.4 ) Markets – November 2019 for rejection or subsequent revocation any... And across the dubai Metro market REVIEW and FORECAST 2019 Please refer to new... Delivered in the Gulf region for the private sector rival Cheers a challenging market in 2018 agriculture to! Are operating in the first quarter of 2020 amid coronavirus-related disruption, after decelerating for two consecutive quarters 2019. Over-Saturated in 2019, an increase of 23.7 uae food industry report 2019 and nearly US $ 424.6 million of U.S. foods! Past few years, we have been overwhelmed by the interest and response we have received for our.... 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