SAUDI ARABIA – Saudi Arabia’s wheat production is on a steady upward trajectory, with expectations pointing towards a 25% increase in the upcoming 2024-25 season, reaching a total of 1.5 million tonnes.
This surge in production reflects the nation’s commitment to enhancing its agricultural self-sufficiency while addressing the growing demands of its burgeoning population and expanding economy.
The Foreign Agricultural Service (FAS) of the US Department of Agriculture underscores that this production increment aligns with the maximum allowed production quota, subject to potential adjustments by the Ministry of Environment, Water, and Agriculture (MEWA).
Such adjustments hinge on factors like underground aquifer levels and global wheat supply dynamics.
Under a voluntary program, wheat cultivation is restricted to small farmers licensed by MEWA, who can opt to grow either wheat or alfalfa hay. Previously, alfalfa hay held greater appeal among farmers due to its profitability.
However, the implementation of competitive wheat prices, set at US$467 per tonne last year, has incentivized wheat cultivation. While prices for the upcoming crop are yet to be determined, farmers anticipate them to remain consistent with the previous year’s rates.
Domestic consumption of wheat is projected to surge by 5% to reach 4.75 million tonnes, reflecting sustained robust demand.
This demand surge is further fueled by the rapid growth in tourism, which witnessed a remarkable 63% increase since 2022 and is anticipated to attract 70 million international visitors by 2030.
Consequently, the nation anticipates heightened import demands for wheat, rice, and corn in the coming years to meet the evolving consumption patterns.
Saudi Arabia’s ongoing infrastructure development projects, accompanied by the influx of millions of foreign workers, are driving increased demand for food products, particularly rice and poultry.
Additionally, the poultry industry is experiencing significant growth in tandem with rising rice consumption.
The FAS notes that historical consumption peaks during Ramadan and the Hajj season may undergo shifts due to ongoing development projects. Additionally, rice consumption in the 2024-25 period is forecasted to surge by 6%, reaching 1.6 million tonnes.
Despite its domestic agricultural advancements, Saudi Arabia remains reliant on rice imports to meet domestic consumption, with imports estimated to reach 1.62 million tonnes in 2024-25, marking a 4% increase.
This trend is expected to persist, driven by expansions in the food service sector, necessitating a projected 5% increase in imports over the coming years.
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