In this in-depth conversation, exciting developments in the coffee sector in the Kingdom of Saudi Arabia were highlighted through the hosting of Mr. Fahd Al-Nuhayt, Chairman of the Saudi Coffee Company. The discussion began by exploring the company’s vision and objectives since its establishment in 2018, touching upon the importance of coffee as part of Saudi cultural heritage and how the Public Investment Fund aims to enhance this sector. The conversation also covered investment opportunities and challenges faced by farmers, such as irrigation issues and climate change.
The efforts to increase productivity were addressed through the establishment of model farms and the training of farmers on best agricultural practices, as well as the pursuit of developing the necessary infrastructure to achieve ambitious goals of planting 5 million coffee trees by 2030. Opinions of café owners and investors in the sector were discussed, with some considering that the company’s activities could pose a threat to fair competition.
Furthermore, the importance of the academy established to educate farmers was emphasized, focusing on experiences from countries like Colombia and Brazil. In the end, there was a discussion about the company’s expected expansion in the future by opening experimental centers in global cities like Paris, London, and New York, to enhance the global image of Saudi coffee. This conversation represents a window into a promising future for the coffee sector in Saudi Arabia and highlights the company’s commitment to boosting local production and achieving sustainability.
Obtaining accurate details about the podcast conversation topic requires a comprehensive analysis of the content. Based on what was mentioned, here are the main topics discussed in the dialogue, along with a detailed description of each topic:
Establishment of the Saudi Coffee Company
The Saudi Coffee Company was established in mid-2022 as part of the Kingdom’s Vision 2030. The desire to support the local coffee sector and push it towards global recognition was the main driving force behind this establishment. Before the establishment, a steering committee comprising experts in agriculture and investment was formed to study the current state of the coffee industry in the Kingdom. The aim of this study was to enhance the competitiveness of the local product and increase local production, especially in the Jazan region, which is considered a historical area for coffee cultivation. There was a focus on understanding the challenges facing farmers, such as water scarcity and agricultural requirements. Effective steps were taken to secure appropriate infrastructure and support farmers by finding agricultural models that enable them to leverage their expertise and improve their production.
Supply Chain in the Coffee Industry
One of the important topics discussed was the supply chain in the coffee industry and how the company operates within its various stages. It starts with cultivation, where the company seeks to enhance tree planting and improve productivity by providing technical support to farmers. Then comes the coffee processing stage, where a factory for drying and roasting coffee is being established, allowing farmers to prepare their products professionally. These stages are vital for developing the quality of local products and increasing competitiveness in both local and international markets. The company also aims to open experience centers in several locations, helping to raise consumer awareness of Saudi coffee products and spread local coffee culture.
Challenges Facing Coffee Cultivation in Saudi Arabia
Coffee cultivation in Saudi Arabia faces numerous challenges, the most significant being water scarcity and a lack of young workforce in the agricultural sector. Many farmers suffer from an aging average population, leading to a lack of renewal in this sector. Moreover, climate change plays a significant role in reducing areas suitable for coffee cultivation. There is a need for greater awareness of sustainable agricultural practices and providing the necessary resources to farmers to encourage them to return to this sector. Additionally, there is a need to develop more efficient irrigation systems suitable for local conditions, so that agricultural returns can be improved without depleting water resources.
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The Future of the Coffee Sector in Saudi Arabia
The Saudi Coffee Company anticipates significant growth in the coffee sector by 2030, aiming to reach 5 million coffee trees. Investment in this sector seeks to achieve a balance between local production and consumption, with production expected to reach around 2,500 tons by 2030. By focusing on agricultural development and increasing productivity, in addition to enhancing value-added through manufacturing and trade, Saudi Arabia can become a global coffee trading center. This requires sustainable investment in knowledge and technology, teaching farmers how to improve the quality of their products, as well as supporting research and development in this field.
Investment in Education and Training in the Coffee Sector
The company has played a key role in promoting education and training in coffee cultivation. By opening a specialized academy, the company aims to train farmers in best practices in agriculture, drying, roasting, and coffee tasting. This investment in education is a vital step to ensure the desired quality in the final product. More than 450 students were trained in 2023, reflecting the company’s commitment to supporting the local community and improving the quality of Saudi coffee. The academy also aims to enhance the practical and theoretical skills of farmers, contributing to raising the overall level of the sector.
The Role of the Saudi Coffee Company in the Value Chain
The Saudi Coffee Company aims to improve the coffee value chain in the Kingdom through its role in the three basic components: farming, midstream, and retail. The main goal is to support Saudi farmers and increase local coffee production, contributing to the realization of Vision 2030. By importing green coffee and assisting in roasting processes, the company seeks to secure a reliable source of coffee for café owners, enhancing their competitiveness and helping to provide high quality at a reasonable price. This approach is pivotal as it ensures the availability of coffee in the local market and strengthens the ability of cafés to offer distinctive products.
Perspectives on the company’s impact on the local market may vary. Some café owners point out that importing coffee and selling it at lower prices may negatively affect market prices and lead to some small investors losing their chance to compete. However, the company emphasizes that it does not seek to monopolize the market or undermine competition but aims to empower all stakeholders in the value chain to benefit from its presence. Instead, the company’s role is to enable farmers and small investors through providing support, training, and assistance in accessing markets.
The company also seeks to ensure traceability of coffee sources, allowing consumers to know where their coffee comes from and ensuring that imported coffee is of high quality. By importing large quantities of coffee, the company can offer products at competitive prices, making it easier for small cafés to access reliable sources at lower costs.
The Importance of Sustainability in Coffee Cultivation
Sustainability is one of the core values emphasized by the Saudi Coffee Company. Sustainable farming practices ensure that natural resources are not depleted and improve the quality of production. By working with farmers to achieve cultivation standards that preserve the environment, the company contributes to promoting sustainable agriculture. There is also a focus on efficiently using irrigation water and modern farming techniques that reduce water consumption and enhance tree growth.
Although challenges related to water may pose a significant obstacle, the company has been active in building large water reservoirs and developing effective irrigation systems. The company is also working with the Ministry of Environment, Water, and Agriculture on rainwater harvesting projects, demonstrating its commitment to improving resource use efficiency and achieving environmental sustainability.
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The importance of sustainability in coffee cultivation through rebuilding the local environment and improving the quality of life for farmers. Sustainable agricultural practices contribute to increased farm productivity, providing job opportunities and boosting the local economy. Consequently, the focus on sustainability is not only an environmental solution but also an economic strategy that benefits all stakeholders involved.
Economic Challenges and Their Impact on the Local Market
The local market faces multiple economic challenges related to pricing and competitiveness. There continues to be a discussion on how the importation of coffee at lower prices affects the local market and whether this kind of practice enhances competition or harms smaller investors. Many believe that pricing coffee below market levels can weaken local farmers and café owners who rely on selling their products at certain prices.
On the other hand, lower prices can make coffee more accessible to consumers, which increases the overall consumption of coffee in the Kingdom. This could lead to an increase in demand for local coffee and bolster growth in this sector. However, the discussion about the long-term impact of this growth on small and medium enterprises remains ongoing, requiring the Saudi Coffee Company to be aware of these dynamics and seek ways to support all parties in the market.
The solution may lie in enhancing cooperation between large and small businesses and finding ways to coordinate pricing and provide support to small investors. Collaboration can lead to creating a more sustainable working environment that benefits everyone, including farmers, café owners, and consumers.
Marketing and Promotion of Saudi Coffee
The Saudi coffee experience is a fundamental part of the marketing strategy adopted by the company. By establishing experience centers, the company enhances the presence of Saudi coffee in the global market and introduces consumers to local products. This effort is not limited to selling coffee, as it extends to providing a comprehensive experience related to Saudi culture and its history. This is one of the important ways to attract tourists and consumers looking to experience something new.
The company seeks to market its products not only at the local level but also internationally, contributing to raising awareness of Saudi coffee as a unique high-quality product. This type of marketing can boost demand for Saudi coffee and help increase market size, benefiting local farmers.
Moreover, promoting Saudi products requires investment in advertising and digital marketing, helping to reach a wider audience. As awareness of Saudi coffee increases, the demand for products can rise, contributing to the company’s goals of increasing its market share and boosting local coffee production. Therefore, effective marketing is a fundamental part of the growth strategy pursued by the Saudi Coffee Company.
Future Expansion and Vision 2030
The Saudi Coffee Company aims to achieve ambitious goals aligned with Vision 2030. Through expanding coffee cultivation and increasing production, the company aims to achieve the goal of planting 5 million coffee trees by 2030. This goal represents a significant step toward enhancing local coffee production and increasing self-reliance in this sector. Additionally, this expansion will have a positive impact on the local economy by creating new job opportunities and increasing investments in the agricultural sector.
Furthermore, focusing on coffee cultivation contributes to achieving food security and enhancing sustainability in agriculture. With increasing demand for coffee, the Saudi market is expected to witness sustainable growth, providing new opportunities for farmers and investors. By working with farmers to improve agricultural techniques and promoting Saudi products, the company can strengthen its position in both the local and international markets.
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Also, opportunities for collaboration with the private sector and other farmers, contributing to achieving positive results and improving the value chain comprehensively. Thus, the Saudi Coffee Company continues to work on creating a better environment for farmers and investors, enhancing the future of coffee in the Kingdom.
The session was summarized using artificial intelligence ezycontent
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