Kingdom to import wheat from Australia

RIYADH: The Kingdom has modified its wheat-import quality specifications allowing imports from Australia, the world's fourth-largest exporter of the grain, the Australian Embassy announced here Friday.

The latest Saudi tender had a minimum 11.1 percent protein level compared with a minimum last year of 12.5 percent. The tolerance level for the ergot fungus was raised to 0.045 percent.

"The new amendments to the requirements allow lower protein levels and a smaller tolerance for ergot fungus," Michael Kavanagh, commercial counselor of the embassy, told Arab News Friday.

He added that the new changes would permit wheat from western Australia, the country's top grain-exporting region, to take part in tenders issued by Saudi Arabia's Grains Silos and Flour Mills Organization (GSFMO).

Australia has been unable to access the 2.5 million tons a year to the Saudi market. The state produced 8 million tons of wheat in 2009/10. Western Australia is already a major supplier of barley to Saudi Arabia.

The Kingdom opened its doors to wheat imports in 2008 when it introduced a new groundwater conservation policy to cut annual irrigated wheat production. It also has plans to stop growing wheat domestically by spring 2016, and import the grain instead.

"Australian shippers competed in a Saudi Arabia tender this month for 550,000 metric tons, with suppliers from Canada and Germany winning the business," said Tom Puddy, wheat marketing manager for CBH Group's export division.

A global glut of wheat this year has increased price competition.

The Middle Eastern country may import two million tons in 2010-11, according to a report last month by the USDA's Foreign Agricultural Service.

http://arabnews.com/economy/article46673.ece