LONDON: The acquisition of a stake in commodity merchant Louis Dreyfus Company (LDC) by Abu Dhabi's ADQ is an important part of the emirates' food security strategy, food and water security minister Mariam bint Mohammed Saeed Hareb Almheiri said.
LDC agreed in November to sell a 45% stake to the state-owned holding company, the first outside investment in the family-owned commodity merchant's 170-year-old history.
The deal, which is expected to close by mid-2021, includes a long-term supply agreement to sell agricultural commodities to the United Arab Emirates, the companies said.
"It is important as a country that is importing a lot of food that we have a handle on some of the supply chain aspects," the minister said in an interview.
LDC's main shareholder Margarita Louis-Dreyfus said on Thursday that the ADQ deal would
enable the acceleration of investments as the commodities trader reported a 66% jump in 2020 net profit.
Almheiri said the 2008 food price crisis, when import bills soared and millions were pushed into hunger and poverty across the globe, was a "wake-up call" for the UAE and food security was a national priority.
The emirates have built strategic grain silos at the Port of Fujairah with the capacity to hold 300,000 tonnes of grain.
She said these are about 60 to 70% full, allowing for an expected increase in use as the UAE expands its food processing sector.
Agri-technology, meanwhile, is playing a key role in boosting locally grown crops although self-sufficiency has so far only been achieved for dates and cucumbers.
Comments
Comments are closed for this article.