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GIEWS Country Brief: Saudi Arabia 29-May-2020

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FOOD SECURITY SNAPSHOT

  • Wheat production gradually increases

  • Cereal import requirements forecast at average level in 2020/21

  • Food price inflation rates increase

Wheat production gradually increases

Owing to natural and geographic conditions, only irrigated crops are grown in the country. Since 2015, domestic wheat production, which used to be on average about 2.5 million tonnes from 500 000 hectares, was gradually phased out in an effort to stop the depletion of local water reserves. From 2018, the Government reintroduced support for wheat production to provide forage producers with an alternative crop. Wheat cultivation is deemed less water-intensive than alfalfa (the main green fodder crop) cultivation.

In 2019, about 200 000 tonnes of wheat were delivered to the Saudi Grains Organization (SAGO), the monopsony purchaser of wheat, although SAGO has been authorized by the Government to purchase up to 700 000 tonnes of wheat annually until 2024.

As the Government strives to reduce domestic forage production, it is likely that more farmers will turn to producing wheat.

Harvesting of the 2020 wheat crop is ongoing and production is forecast at about 500 000 tonnes. In the current season, SAGO’s net purchasing price is SAR 1 140 (equivalent to USD 304) per tonne, well above the current international price of USD 220 per tonne (without freight). Many farmers still prefer to produce fodder crops as 1 tonne of high protein locally produced alfalfa is currently sold at more than USD 300 per tonne.

In light of the strong domestic demand for food and feed, the country is encouraging agricultural investments abroad for products to be then imported. This initiative targets wheat, rice, barley, yellow maize, soybeans and green forage.
As of May 2020, control operations were in progress against immature adult groups of desert locusts that formed in the Nafud Desert in the north and mature adult groups in the south near Yemen.