Thursday 25 July 2024
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Saudi sovereign fund to invest $320M to promote Jazan coffee as a global product

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RIYADH, KSA – The Public Investment Fund (PIF) today announced the launch of the Saudi Coffee Company. The company has been established to enable Saudi Arabia’s coffee bean to be a global product in the future, and will play a vital role in developing sustainable coffee production in the southern Jazan region, home to the world-famous Coffea Arabica.

The launch of the Saudi Coffee Company aligns with PIF’s strategy, which focuses on developing and enabling 13 promising sectors, including food and agriculture, as part of broader efforts to diversify sources of income for the local economy.

In partnership with the private sector, the Company’s primary goal is to ensure that the national coffee industry is enabled along its entire value chain, from bean to cup.

The company will have a strong focus on achieving sustainability across the production, distribution, and marketing aspects of the coffee supply chain, implementing the highest standards and global best practices to empower the national industry’s growth, create new jobs, and promote Saudi Arabia’s capabilities to export the highest-quality coffee beans to the global markets.

The coffee market in Saudi Arabia has grown considerably in recent years, and domestic market statistics demonstrate the attractive opportunity presented by the coffee sector. Market data shows that coffee consumption in Saudi Arabia grew by approximately 4% a year between 2016 and 2021 and is forecast to increase by a further 5% per annum up to 2026, reaching an expected annual consumption of 28,700 tons*.

Over the next ten years, the company intends to invest nearly SAR 1.2 billion in the national coffee industry, with the goal of boosting the country’s production from 300 tons per year to 2,500 tons per year. According to the latest statistics, the national production of the Saudi Khawlani coffee beans comes from the mountainous regions of Jazan, Al Baha, and Aseer. Across the three regions, there are more than 2,500 coffee plantations with a combined total of around 400,000 coffee trees.

As part of its role to build expertise across the industry, the company will also localize knowledge and introduce the latest technologies across the planting, harvesting, roasting, and marketing sides of the coffee industry in Saudi Arabia. With these goals in mind, the company plans to establish a dedicated academy in various locations in the country, where Saudi Arabian professionals, entrepreneurs, coffee plantation owners, and farmers can receive the training and knowledge they need to help them start their own businesses. The academy will also help locals in the region to contribute to the industry’s growth and take advantage of the opportunities this creates.

*Source: Euromonitor International, (2022).

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