As the Middle East’s hospitality and food service sectors accelerate toward net-zero and achieving their circular economy goals, procurement has become one of the most strategic levers shaping hotels, caterers and restaurants’ sustainability credentials. The considerations guiding purchasing decisions are evolving beyond price and quality to include environmental impact, traceability, and alignment with national sustainability frameworks.
In the Middle East, UAE’s Circular Economy Policy 2021–2031 and Saudi Arabia’s Vision 2030 are already setting measurable expectations for waste diversion, resource efficiency, and supply chain integrity. For the industry, these frameworks will soon translate into contract requirements, sustainability disclosure criteria, and reputational benchmarks that increasingly influence both B2B partnerships and consumer trust.
The circular economy is an economic system designed to minimize waste and maximize resource efficiency by keeping materials and products in use for as long as possible. Unlike the traditional linear economy (take-make-dispose), a circular economy focuses on designing out waste, keeping products and materials circulating through reuse, repair, refurbishment, remanufacturing, and recycling, and regenerating natural systems. The goal is to create a closed-loop system where resources are continuously cycled back into production rather than being discarded, thus reducing environmental impact and maintaining economic value.
In this context, understanding how ingredients connect to circular systems is a strategic imperative. Malaysian Palm Oil provides a useful example of how a commodity supply chain can embody circular principles that help regional businesses meet sustainability targets.
Across Malaysia, palm oil mills have evolved into self-sustaining ecosystems. These mills burn oil palm’s residual biomass such as empty fruit bunches, shells and fibres to generate steam for renewable energy, which powers operations. The surplus electricity is often exported to national grids and provides additional income to the operators. This upstream carbon displacement happens long before the product (i.e. palm oil) reaches the supply chain of a hotel or caterer, yet it contributes to lowering Scope 3 emissions in sustainability reporting.
The same mills are increasingly closing nutrient loops by treating palm oil mill effluent (POME) into organic fertiliser, which reduces dependence on agrochemicals and improves soil health. Other by-products are similarly recovered for high-value uses – palm kernel cake as animal feed, palm kernel shells processed into activated carbon for water purification, and lower-grade oil streams converted into biofuel. Each step reflects the circular principle of eliminating waste and regenerating natural systems.
For the Gulf’s catering industry, where palm oil remains a key ingredient for frying, baking and packaged goods – choosing vegetable oil from verified circular systems can directly support regulatory compliance and brand positioning. Malaysia’s national certification scheme, Malaysian Sustainable Palm Oil (MSPO), is now internationally recognised and currently covers about 91% of Malaysia’s total palm oil production area. This assures buyers and end users worldwide that the palm oil products they are sourcing from Malaysia are sustainable and responsibly produced.
Indeed, the enhanced MSPO 2.0 standard, which came into effect in January 2025 and is the backbone of the certification scheme, sets a new benchmark for agricultural sustainability. The standard requires 100% prevention of forest loss from the planting of oil palms after 31 December 2019, thorough tracking of carbon emissions, robust worker safeguards, and transparent oversight across the entire supply network. It also embeds circular economy elements, including waste utilisation, traceability and resource recovery, providing procurement teams with documented proof of sustainable practice. For hospitality operators in the Gulf pursuing genuine environmental responsibility this framework offers the confidence necessary for informed sourcing choices.
Circularity, of course, doesn’t end upstream. Across the Middle East, hospitality operators are finding new ways to close the loop within their own kitchens. Recycling of used cooking oil (UCO) is one of the most visible examples. For example, UAE’s Ministry of Energy and Infrastructure, in collaboration with Lootah Biofuels, a leader in the circular economy, has launched an initiative to collect UCO in designated containers for conversion into biofuel, thus supporting the national efforts to accelerate the transition toward renewable and clean energy sources and achieve its net-zero carbon goals.
On the other hand, LuLu Group has gone a step further by fuelling its delivery fleet with biodiesel derived from its own recycled oil, demonstrating how circular thinking can extend from procurement to logistics. Similar initiatives are gaining ground in Saudi Arabia, where Biofuel.sa and collaborations between Aramco, TotalEnergies and SIRC are exploring the conversion of cooking residues into biodiesel and sustainable aviation fuel. These projects make circularity visible and actionable for the region’s food industry, showing how waste can become a renewable input rather than an operational burden.
Translating this understanding into practice begins with asking the right questions. Below are a few aspects I would recommend buyers to explore:
- Engage Suppliers: Ask about biomass waste management, renewable energy use, and traceability systems.
- Review Production Processes: Evaluate certifications, waste-to-energy capabilities, and circularity metrics alongside product specs.
- Look Beyond Price: Factor in reputational risk, regulatory compliance, and brand value.
- Develop Used Oil Programs: Partner with reputable processors and document contributions to sustainability reporting.
- Educate Your Team: Ensure chefs, facility managers, and sustainability staff understand the rationale behind sourcing decisions.
The region’s sustainability visions require businesses to move beyond aspirational commitments to concrete supply chain decisions. The transition to circular economy thinking represents not just environmental responsibility but strategic business planning. Procurement decisions made today shape the sustainability performance and regulatory readiness of tomorrow’s hospitality operations.
Procurement of Malaysian Palm Oil offers an immediate opportunity to align purchasing power with circular principles.
By Belvinder Sron, Chief Executive Officer of Malaysian Palm Oil Council