Saudi Arabia and UAE are the GCC’s largest consumers of food products by volume, but they only achieved self-sufficiency of 28.7% and 10.8% respectively.
According to the latest report on GCC Food Industry 2019 by Dubai-based investment banking advisory firm Alpen Capital, Oman met over 80% and 70% of the local vegetables and fruits demand.
The report attributed the success mainly to the Oman government’s US$ 4.9 billion investment in agriculture and fisheries-related infrastructure projects during the five-year economic development plan from 2011 to 2015.
In terms of dairy products, however, Oman was only able to meet a quarter of the demand.
Food production and consumption
Oman’s total food production grew at a CAGR of 9.8% between 2011 and 2016 to reach over 1.4 million metric tonnes (MT). Vegetables and meat production witnessed a 15% growth annually during the period.
Total food consumption grew 10.3% between 2011 and 2016 to reach 3 million MT in 2016. Cereals was the most consumed food category, which increased by 8.4%. Meat demand grew by 22.9%, while dairy and vegetables demand grew by nearly 14%.
The report anticipated that within GCC, Oman would likely witness the highest growth in food consumption, increasing from 3.2 million MT in 2018 to 4 million MT in 2023.
Among all food categories, dairy consumption is likely to grow the fastest at 5.6% from 2018 to 2023, followed by cereals at 5.5%.
With this rising increase in food consumption, Oman will have to increase its reliance on imports coupled with its growing domestic food production in order to keep up with the demand.
Oman’s net import volume grew at a CAGR of 11.5% between 2011 and 2016 to 2.4 million MT, with a total value of US$ 2.1 billion.
Although, food production remains challenging for GCC countries due to limited arable land, lack of fresh water resources and arid climatic conditions, the Oman government and industry have implemented initiatives to boost self-sufficiency and meet the domestic food demand.
In particular, areas of priority for the government were agriculture, fisheries, dairy, vegetables and poultry.
In order to increase the country’s self-sufficiency for dairy products, state-owned Mazoon Dairy was established in June 2019. It is expected to produce approximately 202 million liters of milk in 2026 and 985 million liters by 2040.
In May this year, the Omani-Gulf joint investment and International Marine Product Company was established to produce 72,000 tons of sardines and 17,000 tonnes of tuna annually. The fishery segment was listed as one of the five priority sectors under the ninth five-year development plan (2016-20), the others being mining, tourism, transport, and manufacturing.
In March, A’Saffa Foods announced an expansion plan, which included new broiler houses, hatchery equipment, processing plant, and feed mills to eventually increase annual poultry meat production to 42,000 MT.
And in February, the Minister of Agriculture and Fisheries inaugurated the Namaa Poultry Project to produce 66,000 tons of high-quality white meat per year. The project is also capable of producing 100 million eggs per year.