Saudi dates an energy source — and also a healthy investment
The production of dates in Saudi Arabia has been a major contribution in the development of our country’s economy as well as its agricultural sector. The Kingdom is also at the forefront when it comes to the production and export of dates, while also fulfilling the needs of local markets. The geographical and climatic conditions of our country give us a headstart to further increase production and export to compete internationally.
The world’s annual date production is estimated to be more than 8 million tons, with the Kingdom producing more than 1.3 million tons a year. This output places Saudi Arabia among the top three global producers of dates. The Kingdom’s date palms — numbering upwards of 30 million — cover 157,000 hectares of national land and grow over 400 types of dates. Production rates are increasing at a time when global demand has also picked up. However, of the total production of dates, only around 10 percent is exported.
Palm trees grow in different regions of the Kingdom. The most important areas are the Riyadh region (growing over 106 types of dates), Qassim (the highest for domestic date production), Al-Ahsa (accommodates more than three million date palms) and Madinah.
Despite the challenges associated with global trade, I am optimistic about the future of the date industry and the potential for Saudi dates to further expand their reach and increase their global market share. The timing is great for Saudi businesses intending to enter the market as new factors for their success have come to light with the Saudi Vision 2030 reform plan, which has the goal of increasing the share of non-oil exports.
Initiatives to support the global reach of Saudi dates were recently introduced such as the Saudi Dates Mark, which is provided by the National Center for Palms & Dates (NCPD) to align producers with national and international standards. The NCPD also highlights and facilitates investment opportunities in the sector.
Petrochemical giant SABIC recently signed an agreement with the NCPD to initiate a “Palm Tree of the Homeland” program (Nakhlat Watan) to support the cultivation of date palms through sustainable and innovative agriculture methods, boost Saudi Arabia’s strategy of becoming the world’s top date exporter, and enable Vision 2030.
To help achieve its objectives, the program will adopt two main approaches. The first is to establish specialized entities to serve the date and palm sector. These bodies will provide pre-harvest services to improve agricultural practices in small and medium farms. Sub-centers will also be established as needed to provide collection, packaging, marketing, refrigerated transportation, and other post-harvest services. The second approach focuses on introducing new programs to promote and improve growth in several areas, particularly the supply chain and human resources, and boost the status of the palm tree as a national symbol.
I believe that recent reforms and initiatives have opened up investment opportunities in the date industry, making it perfect timing for Saudi entrepreneurs and investors to enter the market and its associated value-added products.
Basil M.K. Al-Ghalayini is the Chairman and CEO of BMG Financial Group.