Saudi Arabia is located smack in the middle of the Middle East and is covered mostly by arid desert, where summer temperatures average some 113 °F, and very little rainfall occurs. Needless to say, it’s not an environment where agriculture thrives so it was surprising to learn that the country is one of the world’s leading chicken producers after nearly doubling production over the last decade. Overall, it is a fast-evolving market that might present some unexpected opportunities for U.S. feed suppliers. Below are more details.
Production: Saudi Arabia’s chicken production has been growing at around +6% a year, according to consultancy firm Gira. Production was on track to make an even bigger jump last year with official data showing poultry meat production up +9% to more than 550,000 tons in the first half of 2024, the most recent data available and marking a record level for Saudi Arabia. According to USDA, the country is now 80% self-sufficient in chicken meat, up from 60% as recently as 2021.
The push to increase poultry production is part of Saudi Arabia Crown Prince Mohammed bin Salman’s ongoing “Vision 2030” strategy, which centers on diversifying the country’s economy and enhancing self-sufficiency. That self-sufficiency goal is heavily geared at food, of which Saudi Arabia imports some 80% of its needs. According to Bloomberg, at least 17 billion riyals ($4.5 billion) of Vision 2030 funds are earmarked for the poultry sector alone. Additionally, the country’s “Agricultural Development Fund “ offers financial support up to 70% for projects that employ modern technology to support the expansion of the poultry industry in Saudi Arabia.
Saudi leaders have smartly recruited some of the world’s leading poultry companies to expand operations into the Kingdom. Brazilian meat giant JBS SA last year quadrupled its production capacity in Saudi Arabia with a new processing plant in the city of Jeddah. Brazilian chicken exporter BRF SA is also expanding operations in Saudi Arabia. In 2022, US-based meat giant Tyson Foods invested in a pair of poultry processing subsidiaries owned by Saudi-based Tanmiah Foods.
Consumption: Interestingly, Saudi Arabia is one of the largest chicken consumers in the world, ranking fourth according to 2023 import data. Again, this is surprising considering that chickens are not native to the region so is not a mainstay of Saudi diets.
Chicken’s popularity in Saudi Arabia – and possibly all of the Middle East – seems to stem from a fast food chain called “Al-Baik,” which opened in the mid-1970s in Jeddah, a Saudi Arabian port city on the Red Sea. Al-Baik specializes in what’s known as “broast” chicken, a cooking technique borrowed from the U.S. South that involves tenderizing pieces of chicken in a pressure cooker and then deep frying them in a signature spice mix. According to legends, rich people in Riyadh used to send their drivers to Jeddah – a more than 9 hour drive – just to buy boxes of Al-Baik chicken. Al-Baik now has more than 50 outlets across the kingdom and consistently beats out rival imports like KFC.
Exports: Saudi Arabia exports chicken to countries in the region, including Kuwait, the United Arab Emirates, and Bahrain. According to the most recent official data, Saudi Arabia exported $243M in poultry meat in 2022, making it the 21st largest exporter of Poultry Meat in the world.
Imports: While Saudi Arabia is close to its chicken self-sufficiency goals, it still relies on some imports. In 2022, Saudi Arabia imported $1.29B in poultry meat, mainly from Brazil. If the Kingdom reaches its goals, those imports are going to eventually dry up almost completely. Meaning Brazil chicken producers stand to lose a valuable export market.
As Saudi Arabia’s chicken industry continues to grow, so will its feed demands. Corn is a key feed grain for Saudi poultry farms, accounting for about 60% of poultry feed formulations, according to USDA. Saudi Arabia’s total corn consumption has recently pushed to above +4.5 MMT. The USDA projects corn consumption will continue to increase significantly over the next several years as Saudi Arabia strives to meet self-sufficiency in domestically produced chicken meat. According to USDA, corn from Latin America continues to dominate the Saudi market due to its competitive prices and presumed high quality. In marketing year 2023/24, Brazil was the largest supplier of corn to Saudi Arabia and had a 40% market share, closely followed by Argentina at 39%, and the U.S. a distant third at 18%. Hopefully, other nations who try to increase their protein sufficiency via increasing livestock will also be consuming more crops for feed and need to import more total supply. (Sources: USDA, Bloomberg, Wired)
