The Business Year

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Dr. Sultan A. Alkhalaf

Director General, Dar Al-Khalaf for Agricultural Studies & Consultations

Osama Khaled Boodai

CEO, Livestock Transport & Trading Company (Kltt)

Kuwait is taking preventative measures to tackle future food and water shortages and safeguard its food security.

What have been some of the challenges in the area of water supply in Kuwait?

Sultan A. Alkhalaf Most Gulf countries suffer from desertification due to a lack of rain, dryness, high temperature, and overgrazing. To solve these problems we need cooperation between Gulf governments represented by the ministries of agriculture and international organizations, especially the World Bank, which can fund anti-desertification projects. As Kuwait owns 371 groundwater wells with a daily production average of 160 million gallons, the expansion of irrigation for the production of animal feed will lead to the depletion of many of the wells, as the currently available production does not meet the fresh water needs of the state. The Ministry of Electricity & Water has taken action to secure the future of groundwater, as Kuwait currently uses about 80% of its groundwater. As a private company, we can help the government through our expertise and experience in the building of forestation areas.

Osama Khaled Boodai KLTT was established mainly for food security, as we do not have enough quantities of livestock for local consumption here in Kuwait. We bring in livestock from around the world and slaughter it in the Arabian Gulf. In Kuwait, the only source of water is the government. We have to maintain the water at a certain temperature, as animals cannot drink hot water. We put a piping system for them deep in the ground so that it cools the water as it moves down and use chillers whenever needed. We continue to check the temperature of the water that sheep drink. We feed the animals every morning and evening so that they can eat and graze without feeling the stress of the heat. We have more than 500 employees working in our operation—it is huge.

With significantly reduced production levels, what are the biggest challenges in maintaining food security?

SAA Food security is one of our major concerns. Meat suppliers have to meet the growing demand for meat over the next 10 years, while an increase in the food security gap will see, in return, a fall in global food consumption due to the lack of sophisticated food infrastructure. With regard to the supply of livestock, Australia and New Zealand primarily supply the Kuwaiti market with sheep. However, these countries suffer from drought, a lack of rain, as well as high grazing costs, which resulted in in a significant decrease in the number of sheep. This and other reasons are why it is important to look for alternative supply sources. Dar Al Khalaf prepared a feasibility study and consultation service for a Kuwait investor to establish a 2,500,000sqm sheep production farm in Ethiopia. This project will produce 10,000 hybrid sheep, crossbreeding Ethiopian sheep with Arab Awassi sheep. Projects such as this will have a great effect on providing livestock for Kuwait.

OKB In Kuwait alone, we import more than 700,000 heads of sheep per year. Our biggest challenge is to find new sources for livestock supply. We stick with Australia, as it is the only country that can supply ships with 80,000 heads in two days as we import of around 1.2 million heads per year of livestock. For our new operation, we are starting with 3,000 ewes of local breeds (Neami), which we buy from the market and breed locally for the future. We will not cover the quantities needed for the country, but we want to start with something. With 3,000 animals, we can reach 50,000 ewes in the next 10 years. This will form the new generation, which we will use for breeding. The livestock quantities in Australia are, in fact, reducing, as there used to be 180 million heads as a flock in 2000, while today there are only 90 million: a 50% reduction. So, if they continue with the current production levels throughout the next 10 years, we might find that there are only 40 million.

What are your expectations for the upcoming year?

SAA Governments, especially in the GCC, must work together in developing other sources to overcome a possible shortage of food and feed resources, particularly in funding research in agriculture, water resources, fisheries, and lack of available arable land. As an expert in animal studies and consultations, I feel the Kuwaiti government is still far from ensuring food security.

OKB By the end of the year, we expect to make 12% net profit, and the same for the next year. By 2018, after opening the new slaughterhouse and adding the new vessel, we expect to reach 15% net profit. On June 30, 2016, we announced a net profit of KWD2 million, which is almost 10% of our paid-up capital of KWD21 million.



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