RIYADH: The Ministry of Agriculture highlighted on Monday the growth and challenges facing the livestock industry during a forum on water and agro-industry in Riyadh.

Dr. Ezeldin Adam Babiker, livestock specialist at the Directorate of Animal Resources at the ministry, talked on agricultural production, particularly dairy products and broilers, in the Kingdom. The gross domestic product (GDP) of Kingdom’s agricultural sector increased to SR53.7 billion in 2014 from SR6.3 billion in 1981.

He noted that agricultural production accounts for 2 percent of value added to gross domestic product (GDP).

However, the agricultural sector struggles due to the country’s unsuitable environmental conditions.

“Saudi Arabia lacks permanent water resources, and therefore, must depend on groundwater and seawater desalination to meet its water demands,” he said.

He said that at present, there are large cattle operations in Al-Kharj, outside Riyadh, because the climate there is less humid and more conducive to cattle raising.

Riyadh Province has approximately 16 dairy projects, Eastern Province has 14 and Western Region has eight. The other projects are located in other parts of the Kingdom.

Saudi Arabia has a 65 percent market share of the 2,225 million liters of milk produced in the GCC annually. The milk industry comprises fresh milk, powder milk, and long-life milk.

The Kingdom’s producers annually export 20-30 percent of dairy production to other GCC countries.

He noted that milk consumption in the Kingdom is growing at an annual rate of 6 percent and the per capita consumption is 56.6 liters, which is relatively low compared to the global average of 120 liters.

The Kingdom annually consumes 854 million liters. Long-life milk and powdered milk represent 38 percent and 28 percent of total consumption, respectively.

Fresh milk consumption stands at 34 percent and showed an annual growth of 8.8 percent since 2007, outpacing long-life milk, which grew by 3.4 percent due to the improvement of cooling and distribution channels. As far as broiler meat is concerned, local poultry production is expected to exceed 850,000 metric tons by the end of 2015.

Babiker said that Brazil is expected to continue to dominate the Saudi poultry import market for the next several years due largely to its price competitiveness and its reputation as supplier for high-quality frozen broiler meat.

For the past several years, Brazil has been the leading frozen broiler meat supplier to Saudi Arabia, followed by France. Argentina and Uruguay are a distant third and fourth.

The forum, which was organized by the German-Saudi Arabian Liaison Office (GESALO), was held in conjunction with the 34th International Trade Exhibition for Agriculture, Water & Agro-Industry in Riyadh.

Dr. Robert Mambauer, a German consultant, gave an overview of livestock production in Germany and business cooperation and opportunities while Al-Ameen Al-Dalali, head of the Trade Fair and Export Promotion at AHK-Saudi Arabia gave the welcome remarks.