Saudi Arabia's SAGO pays $10 more at milling wheat tender

Saudi Arabia’s state grain importer SAGO bought 739,000 mt of milling wheat at tender at almost $10 more than at its previous tender, market sources said Monday.

SAGO bought 12 cargoes at an average price of $241.60/mt CIF – an increase of $9.63/mt since buying 495,000 mt at its previous wheat tender, which closed on December 4.

Prices ranged from $232.69-$245.42/mt CIF, with seven multinational trade houses and cooperatives involved – ADM, Cargill, Casillo, Holbud, InVivo, Olam, and Soufflet.

SAGO is responsible for all 3.5 million mt per year of Saudi Arabia’s wheat imports.

Its buying activity jumped in the late 2000s after it started to wind down domestic wheat production which relied on a costly irrigation programme.

According to SAGO data, annual imports jumped from 303,500 mt in 2008 to 1.92 million mt to a high of 3.8 million mt in 2016, with 2018 imports forecast to reach 3.7 million mt.