SALIC explores grain terminal acquisition in Black Sea

Saudi Arabia's SALIC is conducting due diligence on several projects in the Black Sea region and is looking to acquire a grain terminal there, its managing director told Reuters.

SALIC, the Saudi Agricultural and Livestock Investment Co, was established in 2011 to secure food supplies for the Kingdom through mass production and foreign investments.

"It is part of our mandate to give importance to logistics, so we are looking at SALIC's presence in the Black Sea in the form of a takeover or buying a grain terminal," Khaled Al-Aboodi said on Wednesday.

He added that it is too early to name specific projects or locations.

Last week, the Russian sovereign wealth fund RDIF and SALIC signed an agreement to team up in searching for investment projects in the Russian agricultural sector, on the sidelines of the Russian President Vladimir Putin visit to Riyadh.

Aboodi said SALIC would seek to bring in Russian wheat through state grain buyer Saudi Grains Organization (SAGO) should its investments in potential Russian wheat producers or farmland come to fruition.

Russia, the world's largest wheat exporter, had long been seeking access to the Saudi market and in August the Gulf Arab state relaxed its bug-damage specifications for imports of the grain, opening the door to Black Sea origin wheat.

SALIC is looking to bring in Russian wheat for SAGO's international purchasing tender if it makes a sizeable purchase of a Russian agribusiness firm engaged in wheat production.

"If the company has a good amount of production that means it is cost effective enough to ship the grain, et cetera. Then we will target bringing wheat to Saudi through SAGO," he said.