Qatar plans food cluster to secure sugar, rice supplies at home

[DOHA] Qatar will spend 1.6 billion riyals (S$601.8 million) to build a food-processing and storage facility near Hamad Port in about two years that will more than meet local demand for sugar, rice and cooking oil.

Doha-based Al Jaber Engineering won the contract and has 26 months to design and build the project for the nation's food security, Jassim bin Saif al-Sulaiti, minister of transport and communications, told reporters Sunday in Doha. Qatar invited companies to bid on the project last year, before the Saudi-led trade boycott against Qatar that began in June.

Food security is important in the Middle East because lack of rain and excessive heat make it difficult to grow grains and develop livestock farms. Qatar is in a tougher position because it depended on food coming across the border with Saudi Arabia, which cut diplomatic and trade links with its neighbor last month. Some 38 per cent of Qatar's food used to come through Saudi Arabia, according to Mazen Al-Sudairi, head of research at Al Rajhi Capital.

"This is the first time that these commodities will be processed in Qatar," al-Sulaiti said. It will start looking for a managing agent for the project next year, he said.

The project will have weekly capacity to produce 300,000kg of raw sugar, 600,000kg of rice and 200,000kg of cooking oils, said Maisar Jamil El-Qutami, project executive director at New Port Project, the government body developing the facility near Hamad Port, about 30kmsouth of Doha. Storage facilities will hold enough of the foods to meet demand for over two years. Some production will be used in animal feed, and about 30 per cent of the output may be exported, he said.

Other companies involved in the project are Switzerland's Buhler AG, German BIA and Italy's CM Bernardini, which specializes in equipment for the oil and fats industry, according to a Qatar transport ministry press statement.

Transport Minister al-Sulaiti said Qatar is considering investment in ports abroad, but declined to be more specific.

BLOOMBERG