Brazil’s JBS to open SAR500m Saudi food factory by year end

Image credit: Getty Images

A delegation of Saudi officials, led by the Minister of Industry and Mineral Resources, Bandar Al Khorayef, held strategic talks with leading Brazilian food companies, Minerva Foods and JBS, during a recent visit to Brazil.

The discussions were aimed at exploring opportunities for localising food production within Saudi Arabia, transferring knowledge and innovations, and examining the latest advancements in modern manufacturing technologies.

Al Khorayef visited the facilities of Minerva Foods, a major player in the red meat sector, to review their advanced manufacturing technologies.

The minister discussed potential investment opportunities with company officials, as reported by the Saudi Press Agency (SPA).

At the Roundtable meeting with The Federation of Industries of the State of São Paulo, the Ministry of #Industry_and_Mineral_Resources presented the investment opportunities, incentives, and resources available in the Kingdom’s industrial and mining sectors to various Brazilian… pic.twitter.com/lBGQK6QJNP

— وزارة الصناعة والثروة المعدنية (@mimgov) July 23, 2024

Minerva Foods holds a significant presence in the Saudi market, with imports, particularly of red meat, accounting for 25 per cent of the industry. The Saudi Agricultural and Livestock Investment Company (SALIC) is a major investor in Minerva, holding a 33.8 per cent stake.

SALIC initially acquired a 19.5 per cent stake in 2016 for $210m, subsequently increasing its investment in 2018 and 2020, totalling $204m.

Partnership with JBS

Al Khorayef also met with Gilberto Tomazoni, CEO of JBS, one of the world’s largest meat and poultry producers. JBS is establishing a food factory in Jeddah under the Seara brand, with an investment of up to SAR500m (approximately $133m). The facility is expected to commence operations by the end of this year, addressing the food needs of the Saudi market.

This strategic move signifies the company’s ongoing expansion and commitment to meeting the growing food demands in the Middle East. The new factory will play a crucial role in meeting local needs such as enhancing food security, increasing skilled labour, and contributing to the country’s economic diversification goals.

The establishment of the Jeddah factory is expected to create numerous job opportunities for local residents.

This aligns with Saudi Arabia’s Vision 2030 initiative, which aims to diversify the economy and reduce unemployment. The new facility will not only boost the local economy but also foster the development of the food processing industry in the kingdom.

Technological advancements

JBS is renowned for its pioneering efforts in meat cultivation technology and laboratory production. These innovative methods are expected to be integrated into the Jeddah facility, promoting sustainable and efficient meat production, as per the SPA report.

This aligns with global trends towards more environmentally friendly and resource-efficient food production practices.

Strategic investment in Saudi Arabia

J&F, the parent company of JBS, announced new investments in Saudi Arabia during a 2023 visit by a Brazilian government delegation. Wesley Batista, a member of JBS’ founding family, expressed a growing interest in exploring substantial investments in the kingdom.

JBS plans to enhance its production capacity in Saudi Arabia with the new Jeddah facility, expected to process 40,000 tonnes of chicken products annually, quadrupling current levels.

Saudi Arabia is the largest economy in the Middle East and Brazil’s main trading partner in the region, with bilateral transactions exceeding $8bn in 2022.

Brazil, the world’s top exporter of halal meats produced according to Muslim dietary requirements, is home to some of the most efficient meat exporters. Companies like BRF, Minerva, and Marfrig also compete in the Gulf region, presenting strong competition to JBS.

Economic hub

Saudi Arabia’s Minister of Investment, Khalid Al Falih, emphasised the importance of the food sector as a primary area of cooperation. He stated that Saudi Arabia aims to achieve “food security” and become a “global hub” in the meat sector, further highlighting the strategic importance of these investments.

The partnerships with Minerva Foods and JBS underscore Saudi Arabia’s dedication to ensuring a stable food supply while attracting foreign investment and expertise to its growing food industry.

This aligns with the kingdom’s broader efforts to enhance food security and economic diversification.

Read: GCC food market to benefit as India plans to ease rice export curbs