Ag Growth in the Gulf: Fertilizer and Organic Farming

While wheat production is being phased out in Saudi Arabia there are growth areas in Gulf agriculture, like organic farming and indoor vegetables.

The Gulf also solidifies its position as a major fertilizer producer for global agricultural markets. This is not only true for nitrogen based fertilizer like ammonia and urea that is gained from natural gas, but also for the Al-Jalamid phosphate project, which has started to produce and aims at a 10 percent market share of globally traded Diammonium Phosphate (DAP) fertilizer.

Phosphates are now the focus of Saudi Arabia’s largest mining company Maaden and make up 60 percent of its value according to a research report of Al Rajhi Capital.

On a global level it needs to be noted that the Middle East holds the vast majority of global phosphorus/ phosphates reserves. Fears of a ‘peak phosphate’ by as early as the 2030s have been overblown after the massive upgrade of the Moroccan reserve base, first by the International Fertilizer Development Center and then by the US Geological Survey. Morocco now holds over three quarters of global phosphorus reserves according to the new estimates.

Like Jordan, which also holds considerable reserves, Morocco has been offered GCC membership in the wake of the Arab spring. While this was about politically strengthening Arab monarchies, it is conceivable that Middle Eastern countries might use their fertilizer production in the future to foster relations with agricultural producer countries and improve their food supply security.

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