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USDA International Egg and Poultry

21 November 2012

USDA International Egg and Poultry: Saudi ArabiaUSDA International Egg and Poultry: Saudi Arabia

Saudi Arabia’s poultry consumption has been growing steadily growing at an average annual rate of 5% over the last 2 decades.
USDA International Egg and Poultry

Saudi Arabia

Despite the steady growth in poultry consumption, Saudi Arabia’s domestic poultry production has not kept pace with demand. In 2007 Saudi Arabia’s poultry production satisfied about 51% of its consumption needs. However, in 2011 poultry production had declined to 420,000 metric tons (MT) from 490,400 MT in 2007 resulting in domestic production satisfying 35% of Saudi Arabia’s needs and Saudi Arabia increasing poultry imports 60%.

Broiler meat consumption is expected to keep growing in Saudi Arabia over the next few years due several reasons which include chicken meat currently being the most competitive animal protein source and a growing preference by increasingly diet conscious consumers for chicken meat.

Brazil has been the leading broiler meat exporter to Saudi Arabia over the last several years. In 2011 79% of Saudi Arabia’s imports came from Brazil. Ranking after Brazil for exporting poultry meat to Saudi Arabia, is France while Argentina and Uruguay are a distant third and fourth. For 2011 it is estimated Saudi Arabia imported 786,248 MT, an increase of about 16% from 2010.

In 2013 Saudi Arabia’s total broiler meat imports are forecasted to drop 4% from 750,000 MT in 2012 to 720,000 MT in 2013 due to an expected increase in 2013 production. Some feel broiler meat imports will continue its decline through 2015 when the country’s major poultry producers complete their expansion plans.

The Saudi Arabian government encourages the establishment of new poultry farms and the expansion of existing ones in order to attain the maximum possible broiler meat production self-sufficiency. However, the country’s poultry farms entirely depend on imported production equipment, labor and feed. Saudi Arabia provides interest free loans to new viable poultry farms, and various subsidies for animal feed based on energy and protein levels, buy select poultry equipment, build cold storage facilities and various other items to compensate for the higher production costs.

In an effort to halt soaring domestic poultry prices the Saudi Ministry of Commerce and Industry issued a decree on October, 3, 2012 banning the export of locally produced broilers. Saudi Arabia poultry importers and local producers are blaming the price hikes to the rising cost of feed ingredients with some rising as much as 40%. Also, the Ministry of Agriculture has indicated there has been a significant decline in poultry production this year due to a higher than normal mortality rate and outbreaks of diseases on many farms.

The customs duty on imported chicken is 5% ad valorem duty. In order to protect local food processors and production from competitively priced imports, Saudi Arabia ties import duties to the level of local production of similar products. As a general rule, the maximum import tariff rate of 40% is applied when local production of food or agricultural product exceeds self-sufficiency level.

Poultry shipments must be accompanied by a “Halal” slaughter certificate issued by an Islamic center in the country of origin. The slaughtering must have taken place in an officially licensed plant in accordance with Islamic procedures. A certificate must also be included stating the poultry slaughtered were not fed with feed containing animal protein, animal-fats, animal manure and that the animals were not treated with growth hormones.

Imported poultry meat and products must meet all existing Saudi poultry quality standards and specifications which also include biotech labeling, production & expiration date regulations and Arabic labeling requirements.

Sources: USDA, Foreign Agricultural Service Gain Report Numbers SA1113, SA1213, SA2009; USDA, Foreign Agricultural Service Gain Report Saudi Arabia Agricultural Biotechnology Annual 2012

Saudi Arabia Total Poultry Meat Comparisons 2002-2012 Domestic Consumption, Production & Imports (1,000 Metric Tons)

Source: USDA, Foreign Agricultural Service, Official USDA Estimates

Saudi Arabia Total Broiler Meat 2013-2021 Domestic Consumption, Production & Import Forecasts (1,000 Metric Tons)

Source: USDA, Economic Research Service, International Baseline Projections

US Poultry Exports to Saudi Arabia January-September Comparisons

Source: Department of Commerce, U.S. Census Bureau, Foreign Trade Statistics/USDA, Foreign Agricultural Service

November 2012

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