Saudi Arabia has enough wheat to last more than six months

23 Feb, 2016

RIYADH: Saudi Arabia has 1.8 million tonnes of wheat reserves, up from 1.6 million tonnes this time last year, enough to last more than six months, the director-general of the kingdom's main wheat-buying agency said on Tuesday.

Saudi Arabia has become a major importer of hard and soft wheat since abandoning plans for self-sufficiency in wheat in 2008, as farming in the desert drained scarce water supplies. It has halted purchases of locally grown wheat this year.

Ahmed al-Fares also said he expects Saudi Arabia to complete the privatisation of its flour mills by the first quarter of 2017, although the Ministry of Finance's Public Investment Fund determines the final timeframe.

Saudi General Grains Organization (SAGO) and the Public Investment Fund are studying how to establish four joint-stock companies to operate the flour mills, as approved by the Saudi cabinet in November. The privatised entities will be open to both national and foreign investment.

SAGO, previously called the General Silos and Flour Mills Organisation (GSFMO), said in October that it expected to import 3.5 million tonnes of wheat in 2016.

Fares said Saudi Arabia has not been in the wheat market so far in 2016 because it has enough reserves, but said he expects to go back to the market soon.

Copyright Reuters, 2016

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