Just as Syria’s feed industry was starting to gain traction in the early part of the last decade, the country became engulfed in a civil war. With the conflict still raging nine years later and showing few signs of slowing, feed production capacity has fallen by 50%, but the industry is still functioning despite the turmoil.
Today, there are 15 feed mills in significant operation in Syria, according to Maria Daly, communications manager for Alltech Europe. During the years of conflict, the poultry feed production in the country has shrunk from 1 million tonnes to 700,000 tonnes per year, Daly said, referring to estimations from the Food and Agriculture Organization (FAO).
Other sectors were impacted, too. For instance, about 1.5 million tonnes of milk was produced in Syria in 2017, which, at an average of 8,000 kg of milk per cow per year, computes to about 187,000 cows — a large reduction compared to the pre-war level.
The exact production figures remain unknown since Syrian President Bashar al-Assad’s regime is controlling only around 60% of the country’s territory. The feed mills keep running even in the territories controlled by rebels, especially in the areas controlled by the Kurdish-dominated Syrian Democratic Forces, which include rich agricultural land. But information about the production performance of the feed mills in the different parts of the country is sketchy.
When war broke out in 2011, Syria had an expanding poultry industry with annual production of 300,000 tonnes of poultry meat and 5 billion eggs — 1.5 billion of which were exported to the neighboring Persian Gulf countries. The red meat sector included 15.5 million sheep, 2.01 million goats, 1.01 million cattle and 7,000 buffalo as of late of 2010, the FAO estimated.
Syria was also a major mutton exporter on the global market, supplying its neighbors with close to 3 million sheep per year with a net worth of up to $450 million.
Those figures had been gradually growing as the country’s livestock industry was considered an attractive investment, but the war changed everything. Mutton exports began shrinking in 2011 and completely stopped in 2015, when a full-fledged hunger crisis broke out in Syria with nearly one-third of the local population considered food insecure.
Raw materials in demand
Most feed mills in Syria are operating at rather low utilization ratios, since they are lacking raw materials. The civil war has turned many of the country’s grain fields into wastelands, while any import supplies are complicated by the international sanctions imposed against Bashar al-Assad’s regime.
According to the FAO/WFP Crop and Food Security Assessment Mission, 2019 wheat production is estimated at 2.2 million tonnes, up from 1.2 million tonnes in 2018, but still below the pre-crisis level of 4.1 million tonnes. At 2 million tonnes, the barley harvest is more than five times that of 2018 and over 150% higher than the pre-crisis levels. The 2018 grain harvest was the lowest in almost three decades. Overall, cereal import requirements in the 2019-20 marketing year are forecast at 2.7 million tonnes, the FAO estimated.
State grain buyer Hoboob purchases grain from producers and distributes it among the feed mills. But the prices set for 2018 were so low that the companies preferred to take their grain to countries like Turkey, Iraq and Jordan to make money, according to a source in the Syrian feed industry who requested anonymity.
There was a high level of mistrust of the government because in some regions they were taking grain with a promise of making payments at some point in the future, but no payments were made. Consequently, nobody was willing to deal with the government, the source added.
In 2019, Syria began paying farmers 185,000 Syrian pounds ($359.22) per tonne of wheat, 6% more than in the previous year. The government also acknowledged it had accumulated debts of 400 billion Syrian pounds ($776.70 million) and said it would cover those debts. So far, it hasn’t been enough to encourage grain companies to invest in production, so Syria still relies heavily on grain imports. Almost all imports are coming from the Russian Federation, specifically from Crimea. In recent years, Russian officials made no secret that they had been using the annexed peninsula to export grain to Syria, even though those supplies remained unofficial.
With the signing of the new trade deal for Russian grain exports to Syria, Sevastopol seaport expanded its grain transshipment capacities to 200,000 tonnes per month, said Dmitry Ovasyannikov, governor of Sevastpool, the Crimean capital, at a press conference in 2018.
Syria was importing around 200,000 tonnes of grain per month from Russia, Yousef Hussein Kasim, director of the General Establishment for Cereals Trade and Processing, said in 2019. The country had to increase imports last year because the grain harvest in Syria hit record lows in 2018, he explained.
The U.S. sanctions have strengthened cooperation between Syria and Crimea. In December 2018, a Syria-Crimea trading house was established in the peninsula to facilitate trade between the two countries, according to the Russian Gazette, the official publication of the Russian government.
Export supplies from Crimea have even begun affecting the local market. Crimea was exporting grain to Syria, Iran and Iraq and overwhelming supplies in 2018 prompted the regional agricultural ministry to seek a ban on further exports to protect the Crimean food and feed industry, said Andrey Ruymshin, Crimean Agricultural Minister.
But Crimea is not exporting any grain to Syria officially. Russian Federal Customs service recorded no shipments in recent years. Western sanctions against Crimea or Syria do not restrict foodstuffs, but banking sanctions and asset freezes have made it difficult for most companies to do business with both the country and the peninsula under the Russian authority. It is believed that by not recording shipments officially, Russia protects its grain operators and shippers from secondary sanctions.
Russian analysts pointed out that once the civil war is over, Russia may take advantage from its business with Damascus by turning Syria into a hub for grain re-export to the entire Middle East, especially as long as many neighboring countries have to import grain to meet the domestic demand of their food and feed industries. This provides an opportunity for Russia to build infrastructure in Syria to export these grain products and further distribute them in the countries of the Arab region, said Boris Dolgov, senior analyst at the Institute of Oriental Studies. Jordan, Lebanon and Turkey purchase certain products from Russia, and this gives the country the opportunity to streamline its logistics system and expand exports, he added.
Infrastructure is recovering
There is hope that the demand for grain and feed may start growing again as the government implements the first program aimed to restore the war-torn agricultural industry. The Syrian government last year began distributing free chickens and feed to farmers to support some rural areas and curb the food crisis.
The government said it planned to secure 1 billion Syrian pounds ($2.3 million), aiming to provide 15 egg-laying chickens and 50 kilograms of feed to each household. The authorities bet on the revival of the backyard farms. Out of Syria’s population of 18.5 million, around 4.5 million were farmers before the civil war, but many of them lost their farms over the last nine years, the government said.
The new initiative could involve around 8,000 households in the war-impacted areas and around 400,000 tonnes of feed. Government officials believe the farmers’ efforts to rehabilitate their plots will continue in 2020.
The main question is whether the feed industry is ready to meet the growing demand. Some feed mills are believed to have been damaged during the armed conflict, while others are short-staffed and in poor technical condition. The agricultural ministry said the country would need billions of dollars to rebuild the war-torn economy, something that could take decades to achieve.
In early 2019, the estimated cost of rebuilding the country ranged from $250 billion to $400 billion, with the entire government’s 2018 budget at 3.9 trillion Syrian pounds ($8.9 billion). Of that budget, the amount allocated for reconstruction projects was 50 billion Syrian pounds ($115 million). This is an extremely small figure, especially with the civil war showing no signs of ceasing and the economy continuing to decline. Yet, there are still hopes for an improved future for the feed industry and Syria in general, as its death toll in 2019 was the lowest since the civil war began.