United States farmers are shipping hay and grasses halfway around the world to the Arabian Gulf and in less than a year have captured half of a burgeoning United Arab Emirates market worth between $250 million and $500 million a year, say industry traders.
US and Canadian grass producers have turned out in force at Agra Middle East, the region’s biggest agricultural business trade show which was officially opened today (Monday 29 March 2010) at the Dubai World Trade Centre by HE Rashid Ahmad Bin Fahad, Minister of Environment and Water.
Southern Californian farmers are now shipping around 500,000 tonnes of grass fodder a year to the Arabian Gulf, said Gregory L. Braun, President of Border Valley Trading. “This is a trade that simply did not exist on this kind of scale two years ago but we have a lot of capacity to produce even more,” he said on the sidelines of Agra Middle East.
The UAE is the biggest single regional market for imported fodder at an estimated 1.2 million tonnes last year. “This region is now our fastest growing export market,” said Braun. He and other exhibitors are now setting their sights on Saudi Arabia and other Gulf countries where the market could exceed two million tonnes a year.
Though Agra Middle East has been staged for more than 10 years, fodder producers from California, Colorado, Utah and Washington State are exhibiting at the show for the first time ever.
The fodder is used to feed the huge and growing dairy herds of the Arabian Gulf as well as camels, horses, sheep and goats. The fodder takes between 30 and 45 days to arrive by container ship from the US west coast but remains usable as animal feed for about a year. Abu Dhabi is the biggest single customer with 22 distribution centres where the emirate’s small livestock farmers receive heavily subsidised supplies.
With shipping rates plummeting due to recession and falling prices at the producer level, Middle East companies have secured rock bottom prices for North American grass for fodder in spite of having to ship it in containers from one side of the world to the other, said Edward J. Shaw, President and CEO of International Quality Forage and Feed, Alberta, Canada.
Just over a year ago container loads of fodder were being landed in the UAE at a final price of $459 a tonne. During the course of the year the price was driven down to $235 a tonne. Today producers are said to be targeting a range of $350-$370 a tonne.
“Fodder from the US is currently cheaper and of better quality and Saudi Arabia, Qatar, Bahrain and Kuwait are all looking at placing orders,” said Marwan Barakat, General Manager of UAE-based Middle East Group of Companies which has been importing fodder from different parts of the world for 20 years. “That could change in the next two or three years, however,” he added.
“The UAE and other Gulf countries are investing in agricultural land in countries such as Egypt, Sudan, Pakistan, Kazakhstan and Azerbaijan to grow fodder and they will begin to challenge the US companies.”
Agra Middle East runs until 31 March 2010 and covers five closely linked sectors – agribusiness; poultry and livestock; fishing and aquaculture; floriculture and newly launched machinery and supplies. “The importance of Agra Middle East for the agricultural industry is emphasised by the changing geopolitical nature of the region’s fodder supply market,” said Goutam Malhotra, Exhibition Manager.
Running alongside is the region’s premier event for the veterinary profession - Vet Middle East. It brings together regional veterinary practitioners and public health officials with manufacturers and suppliers of products and services from pharmaceuticals to food supplements as well as the technological advances in veterinary healthcare.
Agra Middle East is supported by the Ministry of Environment and Water, Dubai Municipality and Dubai Flower Centre and sponsored by Dubai Biotechnology and Research Park. For more information about Agra Middle East, please visit www.agramiddleeast.com
Vet Middle East is also sponsored by Dubai Biotechnology and Research Park and supported by Dubai Municipality. For full details of the event, please visit: www.vetmiddleeast.com
