Council Opens Saudi Arabia Market For U.S. DDGS

Seeing a new opening with the exit of Chinese buyers from the DDGS market, the U.S. Grains Council (USGC) worked to promote the feed ingredient in Saudi Arabia, yielding sales six times greater than 2014 purchases.

Saudi Arabia has been a target market for the Council’s promotion of U.S. corn and U.S. DDGS for many years. While these efforts have yielded success with increasing corn imports, DDGS sales were limited to only 8,400 metric tons in 2014.

In 2017, when the Chinese market began to erect trade barriers for U.S. DDGS, a price opportunity was opened up for the Saudi Market. Using Market Access Program (MAP) funds, the Council hosted a Saudi Arabian team in August 2017 that brought key feed grain importers and end-users to Illinois, Virginia and Louisiana to see firsthand U.S. DDGS production as well as meet face-to-face with U.S. suppliers and exporters.

The team learned about how DDGS moves through logistics channels for export markets, quality preservation throughout the supply chain, quality assurance, as well as best buying practices and contract specifications.

Through these activities, the Council aimed to achieve short-term sales and build long-term confidence in food security through trade. The trade team was critical to reassuring this growing market that U.S. corn and corn co-products will be available in abundant quantities at a reasonable price to sustain Saudi meat, milk and egg industries.

In the 2016/2017 marketing year, Saudi Arabia imported 48,500 metric tons of U.S. DDGS valued at $8.8 million, a significant increase from 2014 levels and a clear signal that the Council’s market development, training and marketing efforts are paying off.

The total DDGS shipped to Saudi Arabia in the 2016/2017 marketing year was valued at $8.8 million. The Council invested approximatively $130,000 in 2017 in marketing programs in the Saudi market, generating a return on investment of (ROI) of $67 for every $1 of MAP funds invested.