Australia & Saudi Arabia: ABB wins AU$1b deal to supply barley to Saudi Arabia

Grains marketer ABB Grain Ltd has won a AU$1 billion contract over five years to supply barley to Saudi Arabia, AAP communicated on June 27th. ABB said it had entered into a memorandum of understanding with Saudi Arabia's United Feed Company to supply feed barley.

An ABB spokesman said ABB would supply at least one million tonnes of barley a year, but United Feed had indicated that it would take as much as ABB could provide. "In the past, we have provided one million to two million tonnes a year, depending on how the seasons have gone," the spokesman said.

ABB already has links with United Feed Company, having supplied more than eight million tonnes of barley to the company since 1998.

The barley to be delivered to United under the latest deal will be bagged and branded with the ABB logo and supplied to Saudi Arabia's Bedouin community.

"This agreement provides a solid, long-term support base for Australian barley growers and their grain, which is highly regarded by customers in the Middle East," ABB chairman Perry Gunner said. "It is a significant coup for Australian barley growers and our company."

ABB said Saudi Arabia was the world's biggest buyer of feed barley, importing about 7.5 million tonnes a year. United Feed accounted for most of the grain tonnage.

The barley earmarked for Saudi Arabia will be drawn mainly from South Australian and Victorian growers, and from Western Australia if necessary. ABB and United had agreed to explore other business ventures.

The ABB spokesman said United Feed, as one of Saudi Arabia's largest food producers, was also interested in other agricultural commodities handled by ABB, such as pulses and wheat in bags and containers.