INSIGHTS

Clarity Inspires Growth

Posted by Noura Ramli on May 7, 2019 12:28:14 PM
Noura Ramli
May 7, 2019 | by: Noura Ramli

Home grown in the desert: agri-tech companies in the UAE and Saudi Arabia

The dry, sun-drenched deserts of the United Arab Emirates and Saudi Arabia are not the obvious place to think of cultivating crops, yet restaurants and supermarkets in the region are increasingly stocking fruits and vegetables that have been grown locally – how is this even possible?

Local food production is rapidly rising up the political agenda in countries like the UAE, where spending on food products represents one of the largest sectors in the economy. Yet the vast majority of these products are imported, often at great cost both to the consumer and to the environment. Producing more food locally not only contributes to food security, allowing countries like the UAE to make a (small) step towards self-sufficiency, but also ties into the overarching economic priorities of diversification away from hydrocarbons, encouraging small enterprise and using local products to help promote a national identity both at home and overseas. The UAE-made Al Nassma camel milk chocolate that can be found on the shelves in Selfridge’s is a good example of this.

When it comes to agriculture, what makes this all possible is hydroponic or soil-less cultivation technology, now a fast-growing global industry projected to be worth USD750m by 2022. The technology allows plants to be grown in materials such as rock wool along with potting mix and perlite, with nutrients then delivered to the crops through a series of specialised solutions. Water efficiency – clearly the most important factor in arid environments – is a key advantage, with estimates suggesting that hydroponics reduce water use by 70%, while extending the growing season and reducing the need for chemical fertilisers.

In November 2017, Pure Harvest Smart Farms, an agri-business start-up, secured a historic investment of USD4.5m for the construction of its first high-tech, fully climate-controlled greenhouse facility in Nahel, in the UAE. Based on Diligencia’s research, this is one of many commercial farms across the UAE and Saudi Arabia that are adopting hydroponic and vertical farming technology – see the table below for some of the largest and most prominent amongst them.

Few are claiming that these initiatives will solve the GCC’s food security challenges in the short term, and questions have been asked about the economic and environmental sustainability of farming in the desert once you take into account the energy and water resources, not to mention the initial capital outlay required. However, the sector is attracting significant levels of government support and beginning to see interest from institutional investors, with promises of future yields to come.

ايليت اجرو ذ م م Abu Dhabi, UAE
بادية الصحراء للزراعة ذ م م Dubai, UAE
مزارع الامارات المائية للخضار Abu Dhabi, UAE
مزرعة غراسيا للمحاصيل الزراعية Abu Dhabi, UAE
بيجاسيس اجريتك لتجارة البيوت الزراعية ومعداتها ولوازمها Dubai, UAE
جرين اوبونيكس للخدمات الزراعية ذ م م Dubai, UAE
بيور هارفست سمارت لإدارة المزارع ذ م م Abu Dhabi, UAE
Madar Farms Growing of Vegetables LLC مدار فارمز لزارعة الخضار ذ م م  Dubai, UAE
Saudi Arabian Hydroponics Company  الشركة العربية السعودية للزراعة المائية  Al Khobar, Saudi Arabia
 Aram Saudi Hydroponics Company  شركة ارم السعودية للاستزراع المائي  Riyadh, Saudi Arabia

Topics: Doing Business in the UAE, Doing Business in Saudi Arabia, Investment Insight, Middle East Investment Strategies

About the Author Noura Ramli

Browse Insights posted by Noura Ramli

Our Authors [see all...]

  • Andreas Bjorklund
    Focus: Iran
    Role: Business Analyst
    Oxford,UK

    Andreas is an editor at Diligencia and has previously..

  • Aseel Saif
    Focus: Middle East
    Role: Business Analyst
    Oxford,UK

    Aseel, a master’s graduate of Middle East..

  • Asma El-Ayyadi
    Focus: Quality Assurance
    Role: Data Quality Manager
    Oxford, UK

    Asma is our gatekeeper on quality at..

  • Ben Hedger
    Focus: Customer Experience
    Role: Regional Head MENA
    Dubai,UAE

    Heading up the Diligencia office in..

    search our insights