Saudi Arabia has made its first purchase of wheat grown from an overseas farmland investment in Ukraine, Reuters reports, as the Kingdom makes progress on a years-long shift toward agricultural imports and water conservation goals.
Saudi Arabia’s state grain buyer SAGO on Monday said it bought 60,000 tons of Ukraine wheat from investment firm SALIC, marking its first purchase from agricultural investments overseas aimed at enhancing the country’s food security, according to the Reuters exclusive.
Saudi General Grains Organization (SAGO).
In 2014, Saudi Arabia announced that the Kingdom would rely completely on imported wheat starting from 2016, when domestic wheat production was halted due to the need to limit the use of scare water resources.
The Ukraine wheat cargo was bought at $248 a tonne, after the kingdom asked Saudi private investors with farmland overseas on April 6 to supply it with around 10% of its local needs this year.
Ukraine is a major supplier of barley to Saudi Arabia, but isn’t an annual supplier of wheat to the Kingdom. Ukraine had not exported wheat to Saudi Arabia from 2016-2018.
Russia has sought to compete with the Ukraine and other EU exporters of wheat for the Saudi market.
According to Reuters, Saudi Arabia has long encouraged its private investors to pour money into agricultural investments abroad “to shore up the country’s food security, without tangible results — until Monday’s purchase in terms of imports for SAGO.”
