RIYADH, SAUDI ARABIA — Having recently sold its flour mills to private firms, the Saudi Arabian government is now preparing to sell some of its grain silos as part of its plans to boost the private sector’s contribution to its economy, Bloomberg reported on May 3.
It said state-owned Saudi Grain Organization (SAGO) plans to begin selling grain storage facilities this year and will seek bids from foreign and local firms.
In the past year, SAGO sold its flour mills to a group of local and international investors for about $1.5 billion. In late April, SAGO sold one flour mill for $570 million to a consortium that included National Agricultural Development Co., Olam International, Sulaiman Abdulaziz AlRajhi International, and Abdulaziz AlAjlan & Sons, and another mill for $230 million to a consortium comprised of Abdullah Al Othaim Markets, Allana International Alliance, and United Feed Manufacturing.
SAGO sold its two other flour mills last summer to the Raha AlSafi consortium for $540.1 million and to the Alrajhi-Ghurair-Masafi consortium for $200 million.
In 2018, Saudi Arabia’s Council of Economic and Development Affairs approved SAGO’s plan to sell its flour mills as part of the government’s privatization drive started under Vision 2030.
The privatization process had attracted interest from some of the world’s largest agribusiness companies, including Archer Daniels Midland Co. and Bunge Ltd., and was seen as a litmus test for other large state asset sales to follow.
SAGO is one of the world’s largest wheat and barley buyers. Saudi Arabia has been a major wheat importer since 2008 when it abandoned its plans for self-sufficiency.