SALIC seeks to invest in grains used as feed in poultry industry, says CEO

The Saudi Agricultural and Livestock Investment Co. (SALIC), owned by the Public Investment Fund (PIF), plans to invest in grains that are used as feed ingredients in the poultry industry, CNBC Arabia reported, citing chief executive officer Sulaiman Al Rumaih.

“Saudi Arabia cannot grow much grains, due to water scarcity,” he said.

The CEO said SALIC has a long-term investment strategy, adding that its investments are divided into beef (30%) and grains (70%).

“We interfere in case of a global shortage of a certain commodity, or to maintain stability of market prices,” Al Rumaih indicated.

Some countries like Brazil, which depend on supply chains and workforce, were badly hit by the COVID-19 outbreak, said Al Rumaih. However, the pandemic did not have a direct impact on the company’s operations or liquidity, but it slowed the pace of execution of orders handled by SALIC’s units across the world.

“Higher prices of commodities offset lower profitability from some of these units,” Al Rumaih indicated.

During the pandemic, SALIC secured a loan from the Kingdom to fund its foreign investments. A portion of the loan was utilized to fund its operations in Ukraine and Brazil, which accelerated the acquisition deals.

Al Rumaih pointed out that SALIC is preparing to deploy the artificial intelligence (AI) techniques in agriculture, adding that it roped in a UK company in the field to develop agricultural production sustainability and cut costs.

“We have utilized these techniques in our Ukraine operations, which cut 20% to 30% of the value of inputs used in cultivation,” Al Rumaih noted, adding that the company’s investments are usually not 100% owned.

SALIC’s Ukraine unit has a production capacity of 1 million tons of grains, and it seeks a production ramp-up to around 2-2.5 million tons.

“We are bracing for fish wealth investments in countries using modern fish farming techniques with the aim of transferring the new technology to the Kingdom,” Al Rumaih stated.

Al Rumaih also indicated that SALIC aims to expand its poultry investments in Ukraine due to lower prices of feed ingredients.