Sunday, 17 August 2008

Qassim Agricultural Development Company

It does not take a genius to know that agriculture is not a competitive advantage in Saudi Arabia. Just take a look at the graph of Qassim Agricultural Development Company if you need any further proof.

Qassim argues it has ideal conditions for wheat farming and indeed the company did initally flourished albeit due in our opinion to the government's wheat price support programme. Following the phased elimination of the price support programme, the company has not been a happy place to invest.

The company is trying to diversify into date factory and dairy farming. The company has just reported a 15 per cent fall in sales revenue to SR 36.7 million ($9.8 million) and losses of SR 2 million ($5 million). Needless to say, this is not a company we would recommend for a long portfolio.

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