Spinneys Absorbs Up to Fourfold Freight Costs to Keep UAE Shelves Stocked

In an interview with Arabian Gulf Business Insight (AGBI), Kumar said the cost of sending a 40-foot container from the US had risen from $6,000 to $24,000 since the disruption began in February. A container from the UK now costs about $9,000, against roughly $3,000 before, and transit times from Australia and New Zealand have stretched from 45 days to as long as 70.

The numbers give a product-level view of how the conflict around the Strait of Hormuz is feeding into the cost of food in a region that relies heavily on imports. Spinneys has chosen to protect availability at the expense of margin. "What was important was for us to ensure that rather than having zero stock on the shelf, you bring the product, even if you have to compromise on the margin," Kumar said.

The company normally keeps 92 to 93 percent of its 24,000 product lines on the shelf. That figure has fallen to 87 percent during the disruption, and Spinneys said about 5 percent of shelves were empty at present. Goods from the US, Australia and New Zealand have been the hardest to source, because higher freight rates have made some shipments uneconomical.

To fill the gaps, Spinneys has used its London buying office to find alternative suppliers in Europe and is trucking some goods overland from the UK and continental Europe. Croissants and pastries from Spain now travel by road rather than sea, at a cost of about $18,000, roughly double the sea-freight bill. Road deliveries reach the company's UAE warehouse in 17 to 20 days, which Kumar said is faster and more predictable than current sea routes.

Shipping schedules have become hard to plan. Kumar said smaller vessels have sometimes waited weeks to unload at ports including Fujairah, Kalba, Sohar, Salalah and Jeddah. "We are not able to predict the supply chain effectively and efficiently. And it is too costly," he said.

Fresh food makes up about two-thirds of Spinneys' business, and the retailer flies in between 35 and 40 tonnes of it a day. It has drawn up a list of 550 essential products, including chicken, tomatoes, cucumbers, carrots and mince, on which it has pledged not to pass on additional inflation. Discretionary items carry the higher logistics costs instead: sweet pineapple from Kenya has gone up by AED13 ($3.50), according to the company.

Kumar said Spinneys had also increased orders of private-label goods, which require manufacturers to plan production months ahead. Private label and fresh food give the company more control over sourcing and production costs, which has helped it defend margins.

The pressure has not yet shown up as a fall in earnings. On Friday Spinneys reported a 5.7 percent rise in profit to AED224 million for the first nine months of 2026, though its shares were down 1.62 percent at lunchtime that day.

The company is keeping its expansion plans. It intends to open eight to 10 stores across the UAE and Saudi Arabia in 2027, and is preparing to enter Kuwait next quarter, followed by the Philippines.