Agriculture

Saudi Arabia: Planting new seeds

Saudi Arabia's agriculture sector is in a period of great transition. The government has identified five key segments to focus on as water conservation and use policies take a more prominent role in decision-making. With arable land scarce, the future for agriculture in the Kingdom is likely to involve international cooperation, food security agreements and investment abroad. During the 1980s the government aggressively pursued a policy of self-sufficiency, encouraging farmers to grow crops such as wheat, and subsidizing them by paying a high price for their output. This policy eventually ran into the reality of water scarcity in the Kingdom. According to the Food and Agriculture Organisation of the UN (FAO) in 2006, agriculture accounted for 88 per cent of water use in Saudi Arabia, with municipalities and industry accounting for the remaining 9 per cent and 3 per cent, respectively. Now, the government is in the process of revising its plans for agriculture for the years and decades ahead, maintaining a focus on self-sufficiency while keeping an eye to long-term water sustainability. Dr Fahad A S Balghunaim, Saudi Arabia's minister of agriculture, told OBG that in the future he sees at least five segments in the agriculture sector that can be sustainable and in which the country can be competitive. The five are poultry, aquaculture, greenhouse agriculture, technology and dairy production. Saudi Arabia already has some of the world's most advanced and efficient dairy farms. Although local consumption is low, at 60 liters per year per capita compared with 120 in Europe, the large youthful population presents a great opportunity for producers. Abdulaziz M Al Babtain, the chief executive of the National Agricultural Development Company, the first agriculture company in the Kingdom established by the government in 1981, said that consumption patterns have changed over the past years. ""We see greater demand for single-serve portions, whereas in the past dairy producers sold three-liter bottles of milk, so we must keep up with the changing market requirements." (Source: OBG)

Saudi's Agroinvest to raise US$533m for farm investments

Saudi based agricultural investment firm Agroinvest is close to obtaining approval from the regulator to raise about US$533 million for foreign and local farm investments, its chairman said. Agroinvest, or the International Agriculture and Food Investment Co, is the biggest of many private firms involved in foreign farm investment that were set up in the kingdom since import reliant Gulf Arab countries started buying or leasing land in developing nations to ensure food supplies. But farmland acquisitions by foreign investors have sparked some opposition in developing nations and the United Nations last year voiced concern that farmers' rights in developing nations could be compromised. Usamah al Kurdi, who chairs Agroinvest's founding committee, said his firm would not want to tarnish Saudi Arabia's image by buying farmlands abroad.