Saudi Arabia to buy up to 700,000 tonnes of wheat per year from local farmers

wheat 

Saudi Arabia's state grain buyer, the Saudi Grains Organization (SAGO), said on Sunday that it had approved the purchase of a maximum of 700,000 tonnes of wheat annually from local farmers for five years.

Saudi Arabia has become a major importer of hard and soft wheat since abandoning plans for self-sufficiency in 2008 because farming in the desert drained precious water supplies.

Farmers will be able to grow wheat on a maximum of 50 hectares of land, a statement on state news agency SPA said.

"Wheat prices for the coming agricultural season, 2018-2019, will be similar to the organisation's global import prices or at 1,250 riyals ($333) per tonne, whichever is higher. Prices will be reviewed after two agricultural seasons," the statement said.

SAGO imports Saudi Arabia's entire wheat supply of about 3.5 million tonnes a year.

It has said demand for wheat is expected to expand by an annual 3.2 percent to reach 4.5 million tonnes by 2025, largely due to population growth.