The government aims to produce 80% of its chickens locally over the next five years © Tao Xu / Getty Images 
The government aims to produce 80% of its chickens locally over the next five years © Tao Xu / Getty Images 

Tanmiah plans to boost Saudi poultry supply

31 August 2021

Poultry supplier Tanmiah intends to grow its fresh chicken business in line with the Saudi Arabian government’s goal of increasing domestic supply, according to the company.

The company said it was aiming to help the government reach its target of meeting 80% of local poultry demand domestically in the next five years.

The government is supporting domestic producers with direct and indirect subsidies to help the country move towards self-sufficiency, as well as stricter import regulations on frozen poultry. There is also a growing preference from consumers for locally-produced goods.

Tanmiah’s local sales of fresh chicken have increased by 23% over the past three years, from 66.3m birds in 2018 to 81.5m in 2020, the company said. This year up to June 2021, the company has already sold 49.2m chickens after investing in assets and operations.

The company is planning more capital expenditure in the next five years to increase feed milling, primary processing and further processing capacities to help it capture new and emerging growth opportunities.

With consumers willing to pay a premium for fresh domestically produced chicken meat, the company is expecting healthy returns on its capital investments.

In the first half of this year, Tanmiah’s revenue rose 27.6% year on year to SAR 734.9m ($195.7m), while second quarter revenues increased 30.8% to SAR 366.5m compared with the same period a year ago.

The company said it was impacted by an increase in input costs, as international grain prices on commodity markets rose significantly, as well as a lower subsidy received during the reported period.

Net income was SAR 3.4m in the second quarter of 2021, down from SAR 10.5m in the same period last year.

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