Saudi Arabia’s Breakfast Bowls Brim With U.S. Cereals

By Rosemary Shenouda

Whether they like it roasted, crisped, puffed, flaked or frosted, greater numbers of Saudis are spooning away breakfast cereals. Together, the expatriate Western population and Saudis consume 5,000 to 5,500 metric tons of breakfast cereals annually.

And U.S. cereal companies, milking a growing market, supplied almost half this amount--pouring out 2,484 tons of the tasty processed grains to Saudi Arabia in 1997.

While not turning away from the breakfast of their parents--baked beans, eggs, cheese, olives or ma’soub (pancakes with bananas)--many young Saudis are eating cereals, which are not only convenient, but healthy.

Consumption of traditional breakfast fare will continue to decline as Western influences (particularly satellite TV), a population growth close to 4 percent, changing lifestyles and an abundance of supermarkets make cereals readily accessible to a receptive population.

Local Production Just Began

The four local companies that supply 15 to 20 percent of the country’s cereal needs began production within the past 6 years:

• Wheat Products Co., which buys wheat and honey locally, can produce 250 tons annually. Main output is honey wheat puffs in 25-gram boxes.
• National Bakeries Co. imports corn grits from Europe to produce corn flakes. Plant output averages 450 kilograms per hour.
• Food Products Co. imports La Plata hard flint dent corn from Argentina to produce cereals under its "Wafra" brand name. The plant, capable of producing 1,500 tons a year, sells a small percentage of its output to surrounding Arab countries.
• Al-Muhaidib Food Industries sources corn grits from Germany and the United States. Wheat is bought from government warehouses, and rice is imported from the United States through an affiliate. The company can manufacture 250 to 350 kilograms per hour.

Match Importer to Cereal Type

Not only are Saudi importers plentiful but they have numerous import methods. Some agents represent particular brands; others source from the United States and other countries under their own private label. Some importers hire consolidators in the country of export to fill mixed containers of food items for their own supermarket chain, or for mass distribution.

Import Requirements

The Saudi Arabian Standards Organization (SASO) requires a 1-year shelf life for breakfast cereals; consequently, the product must be marked with production and expiry dates. Shipping requirements also include identifying the product shipped, origin, weight and name of importer and exporter.

If packed, cereals are levied with a 12-percent duty. However, corn grits for industrial use can be imported duty-free. The import requirements aren’t onerous and though mega-firms Kellogg’s and Nestlé now headline the boxed cereal parade, expected growth makes this market one that breakfast entrepreneurs of all sizes will want to check out.

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The author is an agricultural marketing assistant with the U.S. Agricultural Trade Office in the American Consulate General in Jeddah, Saudi Arabia. Tel.: (966-2) 661-2408; Fax: (966-2) 667-6196;
E-mail: atoJeddah@usda1.sprint.com

Table 1.

U.S. Breakfast Cereal Sales Brim Saudi Arabia’s Breakfast Bowl

Volume Jumps 75 Percent; Value Up 25 Percent from 1996 to 1997

Last modified: Thursday, October 14, 2004 PM