Saudi Arabia’s plan to start importing wheat and end a massive grain self-sufficiency programme it launched more than two decades ago will weaken the Kingdom’s food security and aggravate a painful Arab farm gap.
The Gulf Kingdom, the world’s richest in oil resources and one of the poorest in terms of water, said this week it would begin importing wheat at the start of 2009 and gradually eliminate a 25-year grain programme that has allowed it to be self sufficient but drained its scarce desert water wealth.
“We have decided that the first imported shipment of wheat will enter the country at the beginning of 2009,” said Saleh bin Mohammed Al Suleiman, director-general of Saudi’s Grain Silos and Flour Mills Organization.
“We are working out arrangements for these imports and will select the best… the size of imports will initially depend on the domestic need and size of production… this year, there has been a decline in cultivated areas while wheat consumption is growing by around eight per cent annually.”
Quoted by Saudi media, Suleiman estimated the Kingdom’s wheat demand at nearly 2.7 million tonnes in 2007, adding that almost all the demand in 2007 and the previous years had been met through local production.
In January, Saudi Arabia announced plans to import wheat and cut purchases from local farmers by 12 per cent a year to conserve water, following reports about an alarming decline in underground resources.
Officials said the government would start reducing purchases of wheat from local farmers gradually and move to 100 per cent reliance on imports by 2015.
Saudi Arabia produces 2.5 million tonnes a year of durum and soft wheat. Cereal and dairy farms across the country account for 85 per cent of water consumption.
The decision to rely on imported wheat follows a surge in Saudi Arabia’s food imports over the past few years, with the bill peaking at more than $10 billion (Dh36.7bn) in 2007 compared with $9.6bn in 2006 and $8.75bn in 2005. Food imports stood at only $4.5bn, according to Arab League figures.
The figures showed Saudi Arabia is recording one of the fastest growth rates in food imports in the Arab world, averaging around 8.3 per cent during 1995-2005.
In 2006, Saudi Arabia accounted for more than 40 per cent of the total Arab food gap, the difference between exports and imports.
The gap has increased over the past 20 years to reach around $19bn in 2006 compared with $13.5bn in 2000 and $12.3bn in 1995. Wheat is one of the main imported crops by the Arab countries, with its gap standing at around $4.5bn in 2006.
“There is no doubt Saudi Arabia’s decision to resort to imports to meet its wheat demand will only widen the overall Arab food gap given the Kingdom’s high consumption and the expected growth in its demand because of a rapid growth in the population,” said an expert from the Khartoum-based Arab Organisation for Agricultural Development.
“We have always regarded the Arab farm gap as a security concern as it means more reliance on abroad for our food. Theoretically, the Saudi move will weaken its food security but it’s worth taking it for the sake of the vital water wealth.”
Poor water resources have forced Saudi Arabia to rely on sea desalination facilities, for which it has invested billions of dollars.
Saudi Arabia is now the world’s largest producer of desalinated water, which meets 70 per cent of its present drinking water needs.
The Kingdom’s 30 desalination plants pump more than 2.27 billion litres of water daily through 3,218km of pipeline. About 50 cities and distribution centres in the country receive water from these plants.
Per capita water consumption in Saudi Arabia is among the highest in the world. Water is heavily subsidised and while one cubic metre of water costs about $1.08 to produce, it is sold for only about three US cents.
Industry sources expect desalination to remain a major industry in Saudi Arabia for generations to come. The government is planning to build 16 water desalination facilities worth $14bn over the next 17 years.
Saudi plans to import wheat to save water