Saudi startup Red Sea Farms secures $10m investment

Saudi startup Red Sea Farms secures $10m investment
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Mark Tester highlighted how KAUST provided the perfect environment for researchers to pursue their passion. (AN photo by Huda Bashatah)
Saudi startup Red Sea Farms secures $10m investment
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Red Sea Farms was established in 2018 with a vision to reduce food insecurity, carbon and freshwater use in the global and Gulf food sectors. (Supplied)
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Updated 08 June 2021

Saudi startup Red Sea Farms secures $10m investment

Saudi startup Red Sea Farms secures $10m investment
  • Firm is part of KSA’s $200-million organic farming action plan

RIYADH: Red Sea Farms, a Saudi Arabian agriculture technology (agtech) startup that uses saltwater to grow crops, has attracted $10 million in venture capital.

The investment in the agtech firm, which is based at King Abdullah University for Science and Technology (KAUST), is one of the sector’s biggest investments to date.

The funding is being led by a group of Saudi and UAE investors, including Saudi Aramco’s entrepreneurship arm Wa’ed, the nonprofit Future Investment Initiative Institute, KAUST and Global Ventures, a UAE venture capital group, Red Sea Farms said in an online briefing on Monday.

The company intends to have up to eight farming sites located in central and western Saudi Arabia and in Abu Dhabi, said Ryan Lefers, CEO of Red Sea Farms, adding that the startup was aiming to expand to the UAE by the end of the year.

Lefers believed there was strong demand for organic produce in the Kingdom, with the company looking to launch 15 snack products by the end of 2021, including peppers and cucumbers.

Red Sea Farms currently operates a saltwater pilot greenhouse at KAUST Research and Technology Park. “We are proud to have designed, developed and delivered one of the world’s most sustainable agricultural systems from our base in Saudi Arabia,” Lefers added. “The investment from our new partners will help us improve global food security while reducing the carbon and freshwater footprint.”

Wa’ed managing director, Wassim Basrawi, said: “The Red Sea Farms investment reflects our decade-long commitment to the Saudi startup sector, where Wa’ed has deployed more than $100 million in venture capital investments and loans to more than 100 entrepreneurs. Red Sea Farms is a good example of a game-changing startup whose innovations not only can transform markets but improve life for everyone in the Kingdom.”

The consortium reflects growing investor interest in the Gulf in sustainable farming solutions that can combat pandemics and global supply chain disruption. 

Food security was important for Gulf countries even before the onset of the coronavirus pandemic.

Red Sea Farms was established in 2018 with a vision to reduce food insecurity, carbon and freshwater use in the global and Gulf food sectors. Through a patented system of new, more efficient solar and growth monitoring technologies, saltwater replaces freshwater typically used to cool greenhouses and irrigate crops.

The startup’s growing systems can be quickly and easily scaled in climates such as the Gulf region, where conventional farming methods are not possible or cost-effective. It is initially using its technology to grow and sell tomatoes in Saudi Arabia, but ultimately plans to sell entire turn-key growing systems to buyers around the world.

Its tomatoes are grown in an environment-controlled, enclosed farm that primarily uses saltwater to cool greenhouses and irrigate crops. It aims to produce a ton of tomatoes by July, four by September and 10 by the end of the year.

To date, Red Sea Farms has raised $11.9 million. The firm received a $1.9 million investment in 2019 from the KAUST Innovation Fund and the Saudi-based Research Products Development Company.

Organic farming, a method of agricultural production for both plants and animals, depends on the use of natural materials to produce food without the use of chemical fertilizers, pesticides or genetically modified materials derived from them.

The Kingdom in 2018 unveiled its organic farming action plan and has allocated SR750 million ($200 million) to support it.

The plan aims to increase organic production by 300 percent. Its other objectives include providing safe food, and sustainable, highly profitable farming, which will be an important resource for the national economy.


Oil hits top price in 3 years as global recovery gathers pace

Oil hits top price in 3 years as global recovery gathers pace
Updated 28 September 2021

Oil hits top price in 3 years as global recovery gathers pace

Oil hits top price in 3 years as global recovery gathers pace
  • Analysts forecast higher demand for oil as the global economy recovered from the pandemic downturn more quickly than expected

DUBAI: The price of oil surged on Monday to within a few cents of $80 a barrel, its highest level for nearly three years, as traders reassessed their outlook for global economic recovery amid tightening crude supply.
Brent crude, the global benchmark, ended the day at $79.60 a barrel — a 90 per cent rise in the last year — and analysts forecast higher demand for oil as the global economy recovered from the pandemic downturn more quickly than expected.
Damien Courvalin, commodities analyst at US bank Goldman Sachs, said: “While we have long held a bullish oil view, the current global oil supply-demand deficit is larger than we expected.” Global demand recovery from the impact of the coronavirus delta variant had been faster than previous estimates, he said, and Goldman raised its year-end forecast by $10 to $90 per barrel.
Christian Malek of JP Morgan restated his forecast of $100 per barrel as all commodities go through a “supercycle” in prices. “The oil supercycle is underway,” he said.
The recovery in oil prices from last spring has been in part driven by improving economic conditions around the world, but also to the action taken by OPEC+ — the alliance of producers led by Saudi Arabia and Russia — to curb supplies when demand was weak.
Although OPEC+ has begun to reverse the cuts, with an extra 400,000 barrels per month allowed until Dec. 2022, Goldman said the oil market would be in “structural deficit” again in 2023 as demand exceeded supply and investment remained low.
Despite the increased OPEC+ output quotas, some big producers have found it difficult to meet the new limits and give the global market all it needs. Saudi Arabia, with the biggest spare capacity in OPEC+, will probablybe a big winner from rising prices and output.
Gas shortages in Europe and elsewhere are also likely to give a boost to oil prices. “Winter demand risks are further now squarely skewed to the upside as to the global gas shortage will increase oil-fired power generation,” Goldman said.
The next OPEC+ meeting will decide whether to stick to the agreed 400,000 increase, but faces a conundrum if prices continue to rise. Some energy experts believe US shale oil could be on the cusp of a resurgence that could eat into OPEC+ market share.
West Texas Intermediate, the US standard, rose above $75 a barrel yesterday, a level many producers will regard as sufficient to justify resuming drilling.


Oil up on tight supply, Brent crude nears $80 a barrel: Market wrap

Oil up on tight supply, Brent crude nears $80 a barrel: Market wrap
Updated 27 September 2021

Oil up on tight supply, Brent crude nears $80 a barrel: Market wrap

Oil up on tight supply, Brent crude nears $80 a barrel: Market wrap

RIYADH: Oil prices rose on Monday for a fifth straight day, with Brent at its highest since October 2018 and heading for $80, as investors fretted about tighter supplies because of rising demand in parts of the world.

Brent crude was up $1.44, or 1.8 percent, to settle at $79.53 a barrel, having posted three straight weeks of gains. US crude futures rose $1.47, or 2 percent, to settle at $75.45 a barrel, its highest since July, after rising for a fifth straight week.

Goldman Sachs raised by $10 its year-end forecast for Brent crude to $90 per barrel. Global supplies have tightened due to the fast recovery of fuel demand from the outbreak of the delta variant of the coronavirus and Hurricane Ida's hit to US production.

“While we have long held a bullish oil view, the current global supply-demand deficit is larger than we expected, with the recovery in global demand from the Delta impact even faster than our above-consensus forecast and with global supply remaining short of our below consensus forecasts,” Goldman said.

Caught short by the demand rebound, members of the Organization of the Petroleum Exporting Countries and their allies, known as OPEC+, have had difficulty raising output as underinvestment or maintenance delays persist from the pandemic.

Global oil demand is expected to reach pre-pandemic levels by early next year as the economy recovers, although spare refining capacity could weigh on the outlook, producers and traders said at an industry conference.

Global demand is seen rising to 100 million barrels per day by the end of 2021 or in the first quarter of 2022, Hess Corp President Greg Hill said. The world consumed 99.7 million bpd of oil in 2019, according to the IEA, before the COVID-19 pandemic hammered economic activities and fuel demand.

In India, oil imports hit a three-month peak in August, rebounding from nearly one-year lows touched in July, as refiners in the second-biggest importer of crude stocked up in anticipation of higher demand.


Petrochemical shares boost Saudi stock market


Petrochemical shares boost Saudi stock market

Updated 27 September 2021

Petrochemical shares boost Saudi stock market


Petrochemical shares boost Saudi stock market

  • TASI gains 0.1 percent to 11,369 points
  • Tadawul ends session in green zone for second consecutive season

RIYADH: The Saudi stock market ended Monday’s session in the green zone for the second consecutive session. 

The Tadawul All Share Index edged up 0.1 percent with fertilizers maker SABIC Agri-Nutrients increasing 6.7 percent and its parent company, Saudi Basic Industries, advancing 2.2 percent.

Despite the rise, banking shares kept the market under pressure. The general index closed trading at 11,369 points.

Liquidity in Tadawul amounted to about SR8.1 billion.

Shares of stc declined by 19 percent, Al-Rajhi Bank’s shares decreased by 0.3 percent, and Riyad Bank shares were down 1.5 percent.

Nomu, the parallel market index, decreased by 1020.82 points, or 4.09 percent, to close at 23923.37 points. Liquidity amounted to about SR152.5 million.

“The Saudi (stock) market is still maintaining its upward trajectory,” Mohammed Al-Omran, head of the Gulf Center for Financial Consultancy, told Arab News.

“We also noticed strong gains today and yesterday in petrochemical companies, whether in high shares or liquidity, and the reason is due to the energy crisis in the world in recent days. Due to these concerns, we are witnessing a rise in the prices of petrochemical companies,” he added.

On Monday, Emaar EC gained 3.6 percent to SR13.7 with over 21 million shares exchanging hands. On Sept. 26, shareholders approved the board’s recommendation to increase capital through converting SR2.83 billion debt owed by the company to the Public Investment Fund.

Six of the 21 market sectors rose, led by basic materials 2.1 percent, commercial and professional services 0.7 percent, and consumer services 0.4 percent.

The biggest gainers on Monday were Gas (21 percent), SABIC Agri-Nutrients (6.7 percent), Fitness Time (5.9 percent), Kayan (4.8 percent), Sipchem (4.7 percent), and Replay (4.4 percent).

 


Sipchem begins hydrogen supply to Aramco firm

Sipchem begins hydrogen supply to Aramco firm
Updated 27 September 2021

Sipchem begins hydrogen supply to Aramco firm

Sipchem begins hydrogen supply to Aramco firm

RIYADH: Sahara International Petrochemical Co. on Monday began supplying hydrogen to Saudi Aramco Shell Refinery Co., Argaam reported citing the company’s bourse filing.

The company attributed the delay in completing the project to the coronavirus pandemic, which further delayed the process of receiving equipment, thus resulting in productivity loss in construction.

The financial impact of this agreement will reflect on the company’s fourth quarter of 2021 financial results.

The agreement will enhance Sipchem’s presence as a reliable supplier in hydrogen production and open up many areas for the company in the gas industry.

According to data compiled by Argaam, Sipchem signed in May 2019 an agreement with SASREF to supply hydrogen gas for a period of 20 years.


Saudi Arabia to introduce rules to promote continued education, says minister

Saudi Arabia to introduce rules to promote continued education, says minister
Updated 27 September 2021

Saudi Arabia to introduce rules to promote continued education, says minister

Saudi Arabia to introduce rules to promote continued education, says minister

RIYADH: Saudi Arabia is considering introducing new rules to facilitate and encourage the culture of continued education, said Saudi Education Minister Hamad Al-Alsheikh.

He was addressing a conference in Riyadh on Monday launched under the auspices of the Human Capability Development Program, which was recently launched by Crown Prince Mohammed bin Salman.

The program’s strategy will be built on three pillars: Developing a resilient and strong educational base, preparing for the future labor market locally and globally, and providing lifelong learning opportunities.

The education minister said the government is taking measures to ensure that graduates find suitable openings in relevant field within 12 months of their graduation.

He also said by 2030 the Saudization percentage in high-skilled positions will increase to 40 percent.

Referring to the national capability development plan, the minister said it aims to develop a guidance system for high school students to help them make career choices based on their aptitudes.

He said efforts are underway to introduce regulations to attract global educational institutions in the Kingdom, which will boost competition between the local and foreign universities.

Ahmad Al-Faheed, governor of the Technical and Vocational Training Corp., said the government in partnership with the private sector will design training programs to increase employment rates and enhance competitiveness among Saudi graduates.

Minister of Human Resources Ahmed Al-Rajhi said that a primary goal of the program is to match talent with demand in the market, and in case of failure of matching candidates with available jobs, the program will upgrade their skills.

Industry Minister Bandar Alkhorayef said the aim of the program launched by the Saudi crown prince is to transform the Kingdom’s industrial sector along modern lines. He said the Kingdom has no dearth of talent and the local companies have the potential to compete with their global counterparts.

The minister stressed the importance of adopting modern technology for strong industrial growth.