American corn promoters make a charge into Saudi grain industry

By RJ Whitehead

- Last updated on GMT

© iStock
© iStock

Related tags: Wheat

Saudi Arabia has imported roughly twice as much American corn and associated products this year due to a change in government policy and more competitive prices for the commodity.

Up to June, the country imported 2.1m tonnes of corn—up from the prior five-year average of 861,000 tons—2.5m gallons of ethanol and more than 25,600 tonnes of distiller's dried grains with solubles (DDGS), according to the US Grains Council.

The industry body said the increase in supply was the result of 14 new feed ingredients being added to the national animal-feed subsidy scheme, including US DDGS and new orders for corn gluten feed and meal (CGF). 

Previously, domestic wheat had been used for feed, though the 30-year programme of irrigating domestic wheat production this has been phased out since 2016 in a bid to conserve water resources.

The potential demand for American corn is huge, though it requires extensive market development work. 

While Saudi’s dairy industry is one of the most most modern in the world, and its significant poultry industry supplies birds across the region, the livestock and poultry industries are still relatively unfamiliar with American co-products, the council said.

"There is a constant need for market education and customer servicing to address grain quality complaints​,” while Saudi feed grain importers, end-users and government officials have a limited knowledge of the American grain marketing and handling system, said Ramy Taieb, USGC regional director for the Middle East and North Africa.

To change this, the USGC has been tempting Saudi grain buyers with various initiatives that have brought in millions of dollars worth of new sales.

Last month, for example, the council invited key Saudi feed grain importers and end-users to Illinois, Virginia and Louisiana to see firsthand American grain production, and meet with US suppliers and exporters. 

It also outlined export logistics channels, quality preservation, quality assurance and best buying practices.

"Through these activities, the council is building not just a short-term market, but long-term Saudi confidence in food security through trade​," Taieb said. 

"We are reassuring this growing market that US corn and corn co-products will be available in abundant quantities at a reasonable price to sustain Saudi meat, milk and egg industries​."

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