October 19, 2011

Saudi Arabia to up grain imports

Saudi Arabia's grain purchase is set to increase by 7% in the 2011-12 marketing year amid lower production of water-intensive crops, according to the UN in a Bloomberg report.

Grain imports will climb to 12.16 million tonnes from 11.36 million tonnes in 2010-11, the UN's Food and Agriculture Organization forecast in a report.

Saudi Arabia decided in 2008 to gradually phase out all water-intensive crops including wheat by 2016, after halting subsidies to grow barley in 2003 to save water, according to the Rome-based FAO.

The kingdom is forecast to import two million tons of wheat in the 2011-12 year, the UN agency said. Imports of barley and corn, mainly used for feed, are forecast at 6.7 million tonnes and 2.2 million tonnes respectively, according to the report.

Domestic wheat production is estimated to have dropped 13% to 1.1 million tonnes this year following adoption of the 2008 decree on crops, the FAO said.