Saudi Arabia plans to build new silos and a flour mill near Mecca and to expand grain storage capacity at its Red Sea port of Jeddah, a Saudi official said on Sunday. Saudi Arabia, which has said it has enough wheat stocks for six months, is facing pressure to build up stocks amid expectations of a 30 percent fall in this year's wheat harvest after local producers scaled back output faster than expected.
"There is a new project to build silos and a flour mill near Mecca and to double the storage capacity in Jeddah port," Waleed Elkhereji, director-general of the Grain Silos and Flour Mills Organisation in the kingdom, told reporters. "The flour mill near Mecca will have a capacity for 600 tonnes a day," he said, speaking on the sidelines of grain conference in Sharm El-Sheikh, without elaborating.
Saudi newspaper Okaz said last month that the Saudi organisation planned to build a 250,000 tonne grain silo in Mecca. The organisation does not disclose the level of its wheat stocks but an official from the authority told Reuters in December these stood at 1.3 million tonnes.
Saudi Arabia needs a minimum of 2.6 million tonnes of wheat a year. It started importing wheat in September after the government decided to cut wheat production by 12.5 percent a year, abandoning a 30-year programme to grow its own. The kingdom produced 2.3 million tonnes of wheat in 2008.