RIYADH: Qatar’s Zad Holding Company, responsible for most of the wheat purchases by the state, plans to issue three or four more tenders for the grain this year with prices expected to be little changed for the rest of the year.
Wheat imports will climb to about 250,000 metric tonnes this year from 200,000 tonnes in 2015, chief executive officer Tarique Mohamed said in an interview at the company’s annual meeting in Doha. The next tender should be in June after 40,000 tonnes were bought this month, he said. Qatar usually gets wheat from Australia or parts of Europe, he said.
Most nations in the Middle East rely on other countries for their wheat supplies. Egypt, the world’s largest buyer, will seek 11mn tonnes in the 2015-16 marketing year while shipments to Saudi Arabia will total 3.3mn tonnes, according to the US Department of Agriculture. Wheat futures traded in Chicago, the global benchmark, dropped 20% last year amid a glut.
“Fundamentally there is still a lot of wheat,” Mohamed said. “I don’t see significant price changes going forward in the next six to eight months.” Zad Holding got a government subsidy of QR118mn ($32mn) last year as part of its flour sales domestically, according to the company’s annual report. The company is expanding its flour mill by 150 tonnes a day to 820 tonnes a day by August, he said.
The company has enough wheat in storage to meet about one year of demand for Qatar’s residents. The new Hamad Port being built near Doha should allow the company to expand inventories, he said. “We are waiting for the new port to start so we can shift there because where we are right now there is no space to make any more storage.”
