In what is widely viewed as a growing trend of GCC countries investing in agricultural opportunities overseas, two listed Saudi companies plan to invest in either farming or agri-business abroad under a state-sponsored plan to ensure steady food supplies. Saudi Arabia had previously urged firms to invest in cross-border farm projects after deciding last year to reduce wheat production by 12.5% per year, effectively abandoning a 30-year-old program to grow its own wheat, a plan that helped the kingdom achieve self-sufficiency but concurrently depleted its water supplies.
Hail Agricultural Development Co. (Hadco) announced last month that it would invest roughly $45.3 million in the next two years developing 22,830 acres (9,239 hectares) of farmland in northern Sudan, and will also look at investing in Turkey and Kazakhstan. However, National Agricultural Development Co. (Nadec), the largest listed agri-business company by turnover, has yet to reveal any future plans to invest abroad. Nadec produced 150,000 tons of wheat in 2008, but unlike its rivals, the company’s business is more centered on the production of dairy products and juices, which accounted for 70% of its turnover in 2008, against 16.6% for grains.