Gulf Investors Develop A Taste For ‘Future Foods’


The earliest evidence of modern faming dates back around 23,000 years to a site near the Sea of Galilee in modern day Israel. But while the region might have been one of the birthplaces of agriculture, these days growing food in much of the Middle East is rarely straightforward.

Arid landscapes characterized by extreme temperatures and scarce water resources mean few crops thrive. Date palms are among the few plants which can cope with the hostile environment. The International Center for Agricultural Research in the Dry Areas (ICARDA) estimates date palms cover some 365,000 hectares in the Arabian Peninsula, representing a third of the global total.

Attempts at growing other crops have sometimes run into trouble. Saudi Arabia’s past experiments with growing wheat, for example, proved expensive and a waste of the country’s limited groundwater. After a switch in government policy, local wheat production fell to almost nothing in 2015-18, although it has started to creep up again more recently.

For the most part, Gulf countries have to import large amounts of their food. Consultancy firm Strategy& estimates the six countries of the Gulf Cooperation Council – Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the UAE – import about 85% of their food, including 93% of cereals, 62% of meat and 56% of vegetables.

Only their ample wealth prevents these countries from falling far down the Global Food Security Index. They have at times also invested in overseas farmland in a bid to secure their food supply – but such investments can be contentious with local populations unless carefully managed.

Future foods

Now a new phase of Gulf agriculture appears to be picking up momentum, with Gulf investors putting money into more innovative products and techniques, from lab-grown beef to vertical indoor farms.

In Dubai, the world’s largest vertical hydroponic farm opened earlier this year on a huge site close to Al-Maktoum International Airport. Spread over 330,000 square feet, the facility can produce more than 1 million kilograms a year of leafy greens, using 95% less water than conventional agriculture.

The plants being grown in the indoor facility include lettuce, spinach and arugula. Some of them will make it onto the shelves of nearby supermarkets under the Bustanica brand. But much of the produce will be used by Emirates and other airlines for their inflight catering.

“Long-term food security and self-sufficiency are vital to the economic growth of any country, and the UAE is no exception,” said Emirates chairman Sheikh Ahmed bin Saeed Al-Maktoum, speaking in July when the Bustanica facility opened. “We’ve specific challenges in our region, given the limitations around arable land and climate.”

An hour or so down the road in neighbouring Abu Dhabi, GreenFactory Emirates is building what it claims is the world’s largest indoor farm, which will be able to grow around 10,000 tonnes of fresh produce a year.

In 2020, the Abu Dhabi Investment Office (ADIO) announced a package of incentives worth around AED500 million ($136 million) to bring global agriculture technology (agtech) companies to the emirate. Among those involved are vertical farming company Aerofarms and irrigation specialists RDI.

Bugs and beef

Other investors are exploring more exotic options. In September, the Qatar Investment Authority was involved in a €250 million ($244 million) financing round in French biotech company Innovafeed​, which produces insect-based protein and operates what is said to be the world’s largest vertical insect farm.

In July last year, Abu Dhabi-based DisruptAD – an arm of the ADQ sovereign wealth fund – invested $105 million in Israeli start-up Aleph Farms, which has developed a zero-emission lab-grown beef substitute product.

In Saudi Arabia, one of the most active players has been Prince Khaled Bin Alwaleed Bin Talal, a member of the royal family and son of the country’s most high-profile business tycoon, Prince Alwaleed Bin Talal.

Over recent years, the prince’s Dubai-based investment vehicle KBW Ventures has made a series of investments in food businesses. His portfolio now includes stakes in numerous food-related firms such as Upside Food and Bond Pet Foods, which are developing cell-cultured meats, as well as meat-free businesses such as Beyond Meat, Ripple and TurtleTree.

In an echo of the origins of agriculture itself, Israeli firms are playing a growing role in the Gulf’s food production industry. That is increasingly true in countries such as the UAE that have normalised ties with Israel, but there have been reports that Israeli agtech firms are involved in other countries too, including Saudi Arabia.

Source link

Leave A Reply

Your email address will not be published.