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Saudi Arabia To Import More Wheat

Saudi Arabia plans to import around two million tonnes of wheat in 2011 like last year and will boost imports to three million tonnes after 2016 as it ends local production, a source at the grains authority said Feb. 2.

The top OPEC oil exporter has emerged as a major wheat buyer to feed its rising population as the growing economy is attracting more foreign workers, while gradually ending local production to conserve water in the arid desert kingdom.

The Gulf Arab state produced 1.2 million tonnes of wheat locally in 2010 but expects that local production will stop by 2016 when the kingdom’s needs will be covered by imports, the source said.

Saudi Arabia imported 1.98 million tonnes of wheat in 2010.

Saudi Arabia wants to build up reserves of basic commodities such as wheat, rice, oils and sugar to counter a global spike in food prices. The arid desert kingdom hopes to double its wheat reserves to a year’s worth within three years.

To help build reserves that will last it a year instead of six months, the Gulf Arab state is adding 550,000 tonnes of storage in four cities within three years on top of its existing capacity of 2.52 million tonnes.

At the same time, Saudi Arabia is encouraging the private sector to invest in farmland in more than 20 countries abroad but not much has been signed yet, analysts say.

Zambia Farming To Get World Bank Support

The World Bank will invest $160 million in Zambian agriculture in 2011 to boost irrigation and livestock farming, its country manager said Feb. 1.

“We concluded negotiations for the investment of $115 million in an irrigation project and expect to invest another $45 million in livestock within this year,” Kapil Kapoor told Reuters.

The money is due to be released in the second half of the year.

The planned investment would primarily target small-scale farmers, although some of the funds would be used to strengthen the Agriculture and Livestock ministries, he added.

“The irrigation project is intended to benefit targeted small-scale farmers and the investment in livestock will help strengthen veterinary services,” Kapoor said.

Zambia is Africa’s biggest copper producer, and sales of the metal account for 80 per cent of all export earnings. However, farming is still the biggest section of the economy, accounting for nearly 20 per cent of annual output.

Food Crisis Squeezes Central American Budgets

Central American governments faced with rising global food prices are cutting import tariffs, freezing prices and subsidizing food to try to stave off a devastating hunger crisis.

Already struggling to keep fiscal accounts in check after a sharp economic downturn, the region’s small countries risk higher budget deficits and distortions in local markets as they take measures to protect the poorest families.

Forecasts show no easing in grains prices in 2011 and the UN Food and Agriculture Organization, or FAO, estimates 925 million hungry or malnourished people in developing countries.

The sugar-and coffee-exporting countries of Central America are better off than parts of Southern Africa and Southeast Asia, but they are dependent on corn and wheat imports, and poverty levels are among the highest in the Americas.

In Honduras, 70 per cent of the population is poor, and 40 per cent of people in rural areas of Guatemala and Nicaragua live in abject poverty, according to the United Nations.

While high grains prices are helping an economic boom in grain-exporting powerhouses like Argentina and Brazil, small farmers and the urban poor in Central America are vulnerable, especially after droughts and floods wrecked local harvests last year. The poor in Bolivia and other small South American countries are also at risk.

“Before I would buy five pounds of beans every 10 days. Now I can only afford half that,” 66-year-old retiree Amada Lopez said at a central market in Tegucigalpa. “If this situation lasts much longer, we will have to eat one less meal a day.”

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