FOOD AND FODDER

Saudi Arabia 2016 | INDUSTRY | INTERVIEW

TBY talks to Dr. Abdulmalik Alhussaini, CEO of Arabian Agricultural Services Company (ARASCO), on doing business in the Kingdom, partnerships, and new products.

Dr. Abdulmalik Alhussaini
BIOGRAPHY
Dr. Abdulmalik Alhussaini has been the CEO of ARASCO since March 2007. He joined the company in 1999 and over the next three years played a leading role in establishing the corn wet milling business. Abdulmalik earned his Ph.D. in chemical engineering from Lehigh University in 1995. He previously acquired his master’s degree in chemical engineering from Arizona State University in 1989. Prior to joining ARASCO, he taught chemical engineering as an assistant professor in the College of Engineering at King Saud University in Riyadh from 1995-1999.

This company was established in 1983, and today plays an integral role in the development of the country. What have been the key elements of its successful growth over the past few decades?

ARASCO is a part of the local supply chain, with the strategic role of supporting food security in a sustainable way. In spite of facing major challenges like severe water scarcity, ARASCO has continued to grow in the food sector for more than 30 years. One primary reason behind our success story is the clear vision of the company. From the beginning, ARASCO defined its role as a producer and facilitator of food production, and thus realized where it should be in the agricultural sector with both its animal and vegetable businesses. One additional factor for our success has been that the company never enters into any activity that does not enhance its position and competitiveness in business. The other thing is that ARASCO activities complement each other. We started as wheat handlers and marketers of agricultural inputs, and then moved to grain storage by constructing and managing silos. Then ARASCO stepped into feed manufacturing, and expanded gradually, reaching a production level of 4 million tons per year in 2015, ranking among the top 10 manufacturers worldwide. Over the years, we have developed five more business units, namely poultry, farm inputs, food ingredients, logistics, and food safety and quality, with each one fulfilling key aspects of the country's food supply chain. Thus, ARASCO has developed competencies in a wide range of business areas to deliver products and services that are essential and integral to the Saudi Arabian food supply chain.

In which areas do you assess opportunities for partnerships?

We concentrate on achieving mutual benefits, and we never hesitate to develop partnerships. We aim to raise the efficiency and competitiveness of our businesses as well as for others. We do not mind entering into new alliances as long as all parties involved are ready to do so, particularly since we are an attentive partner and are well aware of what we add or what we can get from potential partners. For example, we are wholly and extremely satisfied with our partnership with MEFSCO, after developing strong business relations that hold us together. Everyone is keen to foster the success of this alliance. Our separate partnerships with IDAC and Bahari tell a similar story. We believe real and solid alliances will help to maintain our company's role amid changes in the world, and for that reason we deal with an open mind with every alliance or collaboration that may serve our company business and develop it further.

How would you describe the challenges in the Saudi agricultural sector?

The agricultural sector is subject to so many obstacles; however, the main challenge is how to convert the agricultural sector into a sustainable one given the sharp water shortage. We believe water is the critical challenge, and from here we have started to innovate products that help lower the consumption of water, as well as encourage the employment of techniques that support this approach. From overall local annual water consumption of 18 billion cubic meters, the share of the Saudi agriculture sector is about 16 billion cubic meters or approximately 90%. Green fodder depletes about 6 billion cubic meters, which means that about 40% of the water consumed is by agriculture. Having no natural water resources, our country depends on surface and desalinated water. It spends about 1.7% of its GDP (around SAR 2.7 trillion in 2012) in this regard. After the completion of our feed expansion of up to 4 million tons, including 3 million of compound feed, we are saving 3 billion cubic meters of water, or about 50% of water of consumed for growing green fodder. We hope to overcome all obstacles to have a sustainable agricultural sector to provide for most of our local needs going forward.