Food imports likely to touch $4.8bn by 2020

Muscat, April 4 -

Oman has achieved 75.7 per cent self-sufficiency in vegetable production, having invested $4,941 million in agriculture and fisheries-related infrastructure projects and upgraded the existing facilities, says a report from Oman’s investment and export development agency (Ithraa). These investments have been made as per the Eighth Five-Year Economic Development Plan (2011-15).

UN’s Food and Agriculture Organization (FAO) estimates Oman’s food imports to touch $4.8 billion by 2020 as against $2.1 billion in 2010. Food imports mainly include grains, seasonal fruits, dairy products, poultry and meat. Some 57.5 per cent of Oman’s poultry demand is met through imports.

A’Saffa Foods, the country’s largest poultry producer, recorded net sales of $79.08 million in 2014, up from $67.1 million in 2012. In 2015, state-owned Oman Food Investment Holding Company (OFIC) announced establishment of A’Namaa Poultry Company at a cost of $258 million, of which 50 per cent is debt and the remaining 50 per cent equity. OFIC holds 20 per cent in the project and the rest by institutional investors.

The company is expected to produce 60,000 tonnes of poultry meat a year by 2020.

The project is expected to ensure Oman meets 70 per cent of its poultry needs through domestic production by 2030, up from 36 per cent at present.

Another OFIC project is Mazoon Dairy Company, a $258-million investment with OFIC taking a 20 per cent stake. The vertically integrated farm started with 4,000 cows in 2017, with a target of a 25,000-strong herd by 2026. Mazoon plans to produce 202 million litres of milk by 2026 and 985 million by 2040.

The increase in output from other producers and a new milk collection scheme initiated by the government with participation from OFIC is expected to help cut milk imports from 69 per cent in 2014 to 13 per cent by 2026, says the report.

Oman imports 100 per cent of its refined sugar demand, measured at 120,000 tonnes per annum (tpa). The Oman Sugar Refinery Company was established as a joint venture between Britain’s Tate and Lyle Sugars and an Omani investment firm.

The $200-million facility is planned on an area of 180,000m2 at Free Zone Sohar and is expected to produce 1 million tpa of refined sugar.

The refinery plans to import raw sugarcane from Brazil, Thailand, India and Australia.

According to the report, Oman is the largest fresh fish producer in the GCC.

Landings over the past five years have averaged 204,800 tonnes and valued at $446.8 million.

The government investments in Oman’s budding fisheries and aquaculture segments have drawn investor attention.

The Ministry of Agriculture and Fisheries (MoAF) allocated $331 million in the Eighth Five-Year Development Plan for fisheries development.

The figure is likely to touch $1.3 billion by 2020.

Ten new fishing ports are under development. By 2020, the number will rise to 31.

Local fish production has risen significantly over the past few years, with the annual local catch increasing from 158,000 tonnes in 2011 to 192,000 tonnes in 2012.

A majority of the upcoming processing plants will be located at the Fisheries Industrial Zone at the Port of Duqm, set to be the largest multi-purpose fisheries facility in the Middle East.

A $250-million fisheries centre will accommodate 60 processing plants, storage facilities, landing areas, boat repair shops, aquaculture projects and research/ training centres.

Investment in the sector will promote growth of SMEs around the major developing port cities of Suhar, Duqm and Salalah.

“Oman plans to begin seaweed farming on a commercial scale.

Once the water area is allotted, the Sultanate will be the first country in the region to exploit the rapidly growing global seaweed farming industry, the total annual commercial value of which exceeds $5.5 billion, according to FAO figures,” the report said.

MoAF has so far received 31 applications for aquaculture projects with a total investment value of $390 million.

Applications were received for farming shrimps in ponds, fin fishes in cages and tanks, and farming projects for sea cucumber, lobster and abalone.

The Sultanate offers incentives to aquaculture investors which include free repatriation of capital and profits, 70 per cent foreign ownership which may be increased to 100 per cent , no corporate tax of 12 per cent for five years, extendable to 10 years, no Customs duty on aquaculture machinery, equipment, spare parts and raw material for five years, soft loans up to $2.6 million, 3 per cent interest rate for 10 years for projects with 30 per cent Omani ownership and appropriate land right for passed aquaculture projects on MoAF-approved sites.