Oman Flour Mills receives second direct shipment from Australia

MUSCAT, MAY 14

Oman Four Mills SAOG (OFM), the country’s biggest integrated food company, has taken delivery of a second shipment of wheat directly from Australian farmers – a cost-advantageous initiative it now wants to build on by exploring shared farming opportunities with its Australian partners.

Publicly traded OFM, part of Oman Food Investment Holding Company (Nitaj), said the second shipment – facilitated by its wholly-owned Australian subsidiary OMAUS Pty – arrived in Oman during the first quarter of this year.

It comes roughly a year after OFM secured its maiden shipment from Australian wheat farmers in March 2023 in support of its grain procurement programme – a key component of Oman’s national food security strategy. Dubbed a ‘trial shipment’, the 34,500 metric tonne consignment of Australian Premium White (APM) grain was the first such procurement organised by OMAUS Ltd directly with Australian growers. It contributed to cost savings during the aggregation process, in addition to ensuring a superior quality and better consistency of wheat.

Commenting on the most recent shipment, OFM Chairman Ahmed bin Ali al Bulushi said: “The vision of the group is to pursue a more direct relationship with the farmers, minimizing the extended supply chain and the costs incurred along the way. With the successful receipt of the first shipment in Q1 2023, OFM had received the second shipment from OMAUS in the first quarter of 2024.”

Significantly, following the successful delivery of the second shipment, Oman Flour Mills has “commenced discussions with Australian growers to (explore) the feasibility of shared farming,” he noted.

Following disruptions in global grain supply two years agao, triggered by the Ukraine War, Oman Flour Mills began exploring a deeper relationship with Australia – a key source of wheat for the Omani market. OMAUS was established in 2022 to help secure OFM’s grain requirements by working directly with local growers, as opposed to the mega corporations involved in the global wheat trade.

Meanwhile, Oman Flour Mills continues to firm up plans to expand domestically and regionally as well, primarily through a number of mergers and acquisitions, according to the company.

A corporate strategy and roadmap, commissioned to this end, identifies the potential for OFM to consolidate its market position in the feed industry. In its sights is a “target company” currently the subject of a valuation, according to the Chairman.

Likewise, OFM’s investment arm, Atyab Investments LLC, has submitted a bid to acquire the assets of a company engaged in the “sweet & confectionery business”. At the same time, Atyab Food Industries (AFI), a wholly owned subsidiary, has completed the valuation of a potential target bakery, for which an investment proposal is being prepared.

Additionally, AFI and a large Saudi group are jointly undertaking a feasibility study for establishing a green-field bakery in Saudi Arabia. Besides, AFI is exploring a potential with “large bakery”, he added.