Saudi Food Self-Sufficiency Shields Economy from Hormuz Crisis

Containers are seen at a port in Saudi Arabia. (SPA)
Containers are seen at a port in Saudi Arabia. (SPA)
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Saudi Food Self-Sufficiency Shields Economy from Hormuz Crisis

Containers are seen at a port in Saudi Arabia. (SPA)
Containers are seen at a port in Saudi Arabia. (SPA)

The closure of the Strait of Hormuz has pushed global energy and food security to the brink. Saudi Arabia responded by positioning itself as a stabilizing force, turning its western coastline into a lifeline that not only protected its domestic market but also helped offset shortages in neighboring countries.

A proactive strategy that raised self-sufficiency in key food products above 100% helped the Kingdom mitigate the fallout from the geopolitical crisis. Backed by efficient logistics and strong local content, Saudi food security has evolved beyond a statistical benchmark into a pillar capable of absorbing global shocks and keeping goods flowing smoothly amid turbulence.

Official data underlines that shift. The General Authority for Statistics’ 2024 food security report showed record increases in self-sufficiency across several plant and animal products compared with 2023, with some exceeding 100%.

The gains were driven by sustained investment in agriculture, stronger domestic supply chains and diversified import sources. Together, they shielded the local market from sharp disruptions, helping stabilize prices and maintain supply, reinforcing food security as a core pillar in managing global crises.

Ports have been central to that effort. Shura Council member Fadel bin Saad Al-Buainain said Saudi Arabia’s strategic location on the Red Sea and the Gulf provides multiple high-efficiency ports supported by integrated logistics that sustain flows of goods and cargo.

He said the Kingdom faced no difficulty meeting demand or exporting goods after the closure of the Strait of Hormuz, successfully using Red Sea ports as an alternative route. That ensured uninterrupted flows, avoided shortages or price spikes, and strengthened confidence in government measures to contain the impact of geopolitical tensions.

Saudi efforts extended beyond its borders. Al-Buainain said the Kingdom helped compensate for shortages in Gulf states whose imports were disrupted, using Red Sea ports, expanding storage capacity, activating fast-track transit agreements and linking Gulf ports to move goods, alongside overland transport.

“These are tremendous efforts that went beyond the Kingdom’s borders to reach all Gulf states, reinforcing cooperation and integration and underscoring the importance of the Gulf Cooperation Council,” he told Asharq Al-Awsat.

Strengthening local content has been key. Al-Buainain said the Kingdom achieved significant self-sufficiency, particularly in agriculture, alongside other goods including oil-sector industrial parts, whose local availability helped facilities recover quickly after what he described as Iranian attacks.

Sustained local supply has been central to curbing inflation and stabilizing prices, while strategic reserves of essential goods have served as an effective buffer, enabling the state to absorb shocks and meet market demand without disruption, he stressed.

The availability of imports does not guarantee price stability, as rising costs, particularly in air freight, have driven price increases in markets rather than shortages, he added.

Strategic reserves also help regulate prices, Al-Buainain said, noting the role of the Ministry of Commerce in pricing stockpiles at reasonable levels and preventing exploitation during crises.

Saudi Arabia’s transport and logistics system has leveraged its strategic location to generate economic returns while strengthening national security in its broader sense, including food, medical and commodity security, whether sourced locally or imported through western ports.

Osama bin Ghanem Al-Obaidy, an adviser and professor of commercial law, said the Kingdom’s push to develop agriculture and livestock sectors had driven self-sufficiency rates above 100% in several products, reflecting the strength of local production and its ability to meet both domestic and external demand.

Those efforts helped maintain supply and stabilize prices during the Hormuz crisis, which disrupted shipments and drove up shipping and insurance costs, contributing to a sharp rise in global food prices, particularly wheat and rice, he told Asharq Al-Awsat.

Al-Obaidi said the crisis strained global supply chains, causing bottlenecks in goods and vital fertilizers as shipping through the strait declined. Saudi western ports, led by Jeddah Islamic Port and Yanbu, have become key logistics hubs, securing domestic supply while serving as vital arteries for neighboring countries.

Data from the statistics authority showed shrimp self-sufficiency at 149%, dairy products at 131% and table eggs at 103%.

Vegetable self-sufficiency also reached high levels, with eggplant at 105%, okra at 102%, cucumbers at 101% and zucchini at 100%. Dates recorded the highest rate among fruits at 121%, followed by figs at 99%.

In livestock, data from the Ministry of Environment, Water and Agriculture showed the Kingdom met 61% of its red meat needs locally, with production exceeding 270,000 metric tons. That stability boosted market resilience and its ability to meet rising demand, especially during peak seasons.

In poultry, a key component of the Ramadan food basket, self-sufficiency reached 72%, with production surpassing 1 million metric tons. The surplus not only met local demand but also supported exports, alongside tighter oversight to ensure market stability and protect supply chains from external shocks.

The result has reinforced Saudi Arabia’s position as a global contributor to sustainable food security, backed by an outward investment strategy that includes stakes in major producers such as Brazil’s BRF and Ukraine’s MHP, helping secure supplies at source.



Saudi Arabia Emerges as Global AI Hub as Tech Firms Base Regional Operations in Riyadh

The SAS pavilion at the Global AI Show in Riyadh. (Asharq Al-Awsat)
The SAS pavilion at the Global AI Show in Riyadh. (Asharq Al-Awsat)
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Saudi Arabia Emerges as Global AI Hub as Tech Firms Base Regional Operations in Riyadh

The SAS pavilion at the Global AI Show in Riyadh. (Asharq Al-Awsat)
The SAS pavilion at the Global AI Show in Riyadh. (Asharq Al-Awsat)

Saudi Arabia is no longer preparing for the age of artificial intelligence; it is helping shape it. After designating 2026 as the Year of AI, the Kingdom has evolved from a promising market into a major technology hub, attracting global companies eager to establish regional operations.

Reflecting that momentum, US data and AI company SAS selected Riyadh as its regional headquarters for the Middle East and North Africa a year ago. Founded in 1976, SAS is marking its 50th anniversary this year and is among the world’s leading providers of predictive analytics, data management, and machine learning solutions, serving industries including energy, finance, and healthcare.

Speaking to Asharq Al-Awsat on the sidelines of the Global AI Show, held in Riyadh on June 29-30, Khaled Moussa, Senior Customer Account Manager at SAS, said Saudi Arabia’s Vision 2030 has accelerated the adoption of advanced and sophisticated technologies.

He noted that the Kingdom’s modern digital infrastructure has enabled increasingly complex technological operations, fueling demand for SAS solutions and those of other technology firms across multiple sectors.

“The remarkable growth taking place in Saudi Arabia is attracting significant attention in the United States and beyond,” Moussa said. “That has encouraged international companies to make serious commitments to the market because of its rapid adoption of intelligent technologies.”

Although SAS has operated in Saudi Arabia since 1984, he added, “the market has reached a new level of maturity, both in terms of regulation and technology adoption.”

Moussa said SAS maintains a strong presence across several strategic sectors, particularly energy, through its collaboration with Saudi Aramco, the world’s largest energy company.

The company also works with the Saudi Electricity Company, providing advanced forecasting tools to predict electricity demand and support long-term planning, helping improve operational efficiency and future preparedness. SAS also supplies analytical solutions for the water sector to strengthen sustainability efforts.

Moussa highlighted two areas where predictive analytics deliver particular value. The first is market forecasting, where SAS helps organizations anticipate trends and make data-driven decisions while reducing unnecessary costs. The second is predictive maintenance, which allows industrial operators to identify potential equipment failures before they occur, minimizing downtime and avoiding costly repairs.

He also underlined SAS’s long-term commitment to developing Saudi talent. The company partners directly with universities to offer six-month paid internships, equipping students with practical experience before they enter the workforce.

In addition, SAS extends its training initiatives to schools and universities, teaching students how to apply AI technologies and preparing them for future careers.

The Global AI Show brought together more than 100 experts and global leaders from 80 countries, including government officials, innovators, and digital transformation specialists.

The event attracted more than 10,000 participants, 100 exhibitors and sponsors, and coverage from 200 international media organizations, reinforcing Riyadh’s growing role as a global platform for AI policymaking and international technology cooperation.


China Factory Activity Returns to Expansion Riding AI Global Boom

 A man stands next to a poster of a humanoid robot during the China International Supply Chain Expo (CISCE) in Beijing on June 25, 2026. (AFP)
A man stands next to a poster of a humanoid robot during the China International Supply Chain Expo (CISCE) in Beijing on June 25, 2026. (AFP)
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China Factory Activity Returns to Expansion Riding AI Global Boom

 A man stands next to a poster of a humanoid robot during the China International Supply Chain Expo (CISCE) in Beijing on June 25, 2026. (AFP)
A man stands next to a poster of a humanoid robot during the China International Supply Chain Expo (CISCE) in Beijing on June 25, 2026. (AFP)

China's factory activity returned to expansion in June, driven by demand for chips, computers and other AI-related products, as robust export orders and front-loading to the United States to get ahead of tariffs offset weakness elsewhere in the economy.

The data suggest global AI investment is providing an important cushion for manufacturers in China's $20 trillion economy, even as disruption from the Middle East conflict and a prolonged property slump continue to weigh on broader growth.

The official manufacturing purchasing managers' index (PMI) rose to 50.3 in June from 50.0 in May, according to a survey by the National Bureau of Statistics (NBS). It beat a median forecast of 50.0 in a Reuters poll.

"Exports to meet international demand for chips and other AI-related products, as well as front-loading to get ahead of new US Section 301 ‌tariffs due late ‌July and improved domestic demand due to lower upstream costs underpinned the improvement," said ‌Dan ⁠Wang, China director ⁠of consultancy Eurasia Group.

The number of domestic infrastructure projects ticked up over the last month too, she added. US retailers have brought forward orders from China by four to six weeks to secure their inventories for Black Friday and Christmas holiday sales before the expected tariff hikes later this year, shipping executives said.

The sub-index for new export orders returned to expansion in June, rising to 50.1 from 48.6, while the production and overall new orders gauges edged up to 51.4 and 51.2 from 51.2 and 49.9, respectively.

Factory gate prices slipped to 48.2 from 51.9 in May, however, following five months of expansion, with ⁠employment also continuing to trend downward.

"The export strength is set to continue, driven by ‌global AI investment demand," said Xu Tianchen, senior economist at the Economist Intelligence ‌Unit. "Second, more policy easing will come."

"For example, fiscal spending has lagged behind budget arrangements, and it should accelerate in the coming months. There ‌is also room for monetary easing," he added.

The non-manufacturing PMI, which includes services and construction, improved to 50.2 ‌versus 50.1 in May, while the composite PMI came in at 50.6 compared with 50.5 a month earlier.

AI BOOM OR BUST

With the property crisis showing little sign of stabilizing and household spending remaining subdued, policymakers face the challenge of managing a two-speed economy.

There is enormous international demand for semiconductors powering data centers and advanced electronics, playing to China's manufacturing strengths, but there does not seem ‌to be much demand for anything else.

Exports of furniture, for example, grew just 1.9% in value terms year-on-year, according to the latest trade data for May, while shipments of ⁠automated data processing equipment ⁠jumped 60% over the same period.

Furthermore, retail sales, a proxy for domestic demand, fell for the first time in over three years, the most recent data for May showed, along with a faster slump in new home prices.

Julian Evans-Pritchard, head of China Economics at Capital Economics, said the improvement "remains heavily dependent on exports and AI-related tech," and warned that "despite the improvement in activity, the manufacturing sector appears to be slipping back into deflation."

China has set a 2026 growth target of 4.5% to 5.0%, slightly below last year's 5% expansion.

With signs of precautionary buying in the wake of Middle East-related price pressures fading, input costs rising and overseas customers running down inventories while awaiting a ceasefire, Chinese manufacturers may increasingly need demand from the world's largest consumer market to regain momentum.

A closely watched meeting in May between US President Donald Trump and Chinese leader Xi Jinping, however, produced no meaningful breakthroughs, whether on tariffs or Beijing using its influence over Tehran to end the Iran war.

"The sluggish data from the past few months will likely result in a notable slowdown in second-quarter GDP," said Lynn Song, chief economist for China at ING.

"We're looking for a slowdown to 4.6% year-on-year, with risks slightly balanced to the downside."


EU's Side of US Trade Deal to Come Into Force on July 1

FILED - 03 June 2024, Berlin: FILE PHOTO - The European Union flag flies in the wind. Photo: Sebastian Gollnow/dpa
FILED - 03 June 2024, Berlin: FILE PHOTO - The European Union flag flies in the wind. Photo: Sebastian Gollnow/dpa
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EU's Side of US Trade Deal to Come Into Force on July 1

FILED - 03 June 2024, Berlin: FILE PHOTO - The European Union flag flies in the wind. Photo: Sebastian Gollnow/dpa
FILED - 03 June 2024, Berlin: FILE PHOTO - The European Union flag flies in the wind. Photo: Sebastian Gollnow/dpa

The European Union's side of a trade deal struck with the United States last year, which will remove import duties on many US goods, will come into force on July 1, said a formal European Union regulatory filing.

The EU said this ⁠regulation would apply ⁠from July 1 until December 31, 2029, Reuters reported.

"Where appropriate, the Commission shall submit together with the comprehensive assessment a legislative proposal to extend ⁠the period of application of this Regulation," added the regulatory filing.

Under the agreement, the EU agreed to remove import duties on US industrial goods and provide preferential access to US farm produce.

It will also extend duty-free imports of ⁠US lobster, ⁠a mini-deal struck with Trump during his first term as president.

The EU legislation expires at the end of 2029 and includes multiple safeguards that would allow the EU to suspend concessions if the United States breaches the trade deal's terms.