| Saudi Arabia, seeking foreign farmland to boost its food security, has bought 12,000 hectares of Argentine farmland just as the South American country is attempting to limit foreign farm ownership. Almarai, the biggest food producer in the water-short Middle Eastern kingdom, said it had paid 312m riyals ($83m) for 100% of Foodomonte, which owns and operates three farms in Argentina producing corn and soybeans. The deal "is in line with the direction of the Saudi government towards securing supplies and conserving local resources", Almarai said, a reference to the kingdom's drive to seek alternative food sources after cutting back on its own production to save water. Saudi Arabia three years ago abandoned, in favour of imports, a 30-year-old programme of self-sufficiency in wheat which was depleting valuable water reserves. The kingdom, whose demand for food is being swollen by a population growing at 2% a year, is expected to import 2.0m tonnes of wheat in 2011-12, up from 75,000 tonnes four years ago. Need for feed The deal also "forms part of Almarai's continuous efforts to improve our supply chain and ensure access to the highest quality feed", the group said. While Alamarai is best known as a dairy group, and is the Persian Gulf's biggest in the sector, it also has large poultry operations, in which it in June announced a 4bn riyal investment programme. The Foodomonte takeover "forms another step in Almarai's strategy of securing its supply of farm feed", the group said. Foodomonte is backed by Agro Terra, a London-based private equity group from which Agrimoney.com is awaiting a statement. |