Saudi Arabia set to become major wheat flour exporter as restrictions relax

SAUDI ARABIA – Saudi Arabia’s flour milling sector is on the brink of a transformative shift, with anticipated policy changes likely to propel the Kingdom into a leading role in the global wheat flour market.

By 2025, the General Food Security Authority (GFSA) is expected to transfer wheat procurement responsibilities to private mills, ending its monopoly and granting companies the autonomy to manage imports and exports independently.

This policy reform is poised to position Saudi mills as key exporters, particularly targeting markets in East Africa and the Gulf Cooperation Council (GCC) countries.

The anticipated changes follow the 2021 privatization of Saudi Arabia’s flour milling sector, a landmark move under the Vision 2030 initiative.

The privatization aimed to enhance efficiency, attract foreign investment, and stimulate private sector growth. In November 2022, the GFSA took a significant step by allowing licensed mills to export flour, marking a milestone in the Kingdom’s journey toward becoming a global trade hub.

In addition, Saudi Arabia’s strategic geographic location, straddling the Red Sea and the Arabian Gulf, provides a significant advantage for its flour mills.

The country boasts world-class port infrastructure, enabling efficient import and export operations. Additionally, low operating costs driven by cheap energy and state-of-the-art milling equipment further enhance the competitiveness of Saudi mills on the global stage.

According to the U.S. Department of Agriculture (USDA), Saudi Arabia’s wheat imports are projected to increase by 2% in the 2024-2025 marketing year, reaching 4.25 million metric tonnes.

Experts caution that the transition may take time, as mills navigate the complexities of global trade, including fluctuating commodity prices, supply chain disruptions, and regulatory requirements.

Regional flour mills are also closely monitoring these developments, expressing concerns about intensified competition.

Once public organizations have slowly been turning into the private realm, which means they’ll be better managed for profit moving forward,” a representative from a UAE-based mill noted.

However, the Saudi government is actively supporting the sector by investing in technology and fostering partnerships with international experts to bridge these gaps.

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