Muscat: A new partnership with the aim of promoting value chain, food processing, and logistics support within a growing multibillion dollar regional food industry was formed between Sohar Port and Freezone and Essa Al Ghurair Investment.

Essa Al Ghurair Investment will lease a 93,000 square metres plot from Sohar Port and Freezone until July 2043.

The creation of Sohar Food Cluster Company will allow Essa Al Ghurair Investments to focus on the development of value chains, which will be ideal considering the availability of dedicated infrastructure and competitive prices at Sohar; robust food demand in the Gulf Cooperation Council (GCC), and strong financial projections for a number of identified industries and projects.

In addition to this agreement, there will be a purchase of prevailing assets from Sohar Port and Freezone. The contract was signed by Sultan bin Salem Al Habsi, Chairman of Sohar Port and Freezone, Andre Toet, chief executive officer, Port of Sohar and Chairman of Essa Al Ghurair Investment Company, Essa bin Abdullah Al Ghurair.

Agreement

Contracts were signed at the Dubai World Trade Centre during Gulfood 2015. As the world's largest food and hospitality show, the signing provided a reminder of the role both companies can play in reducing the cost of getting food in and out of the Gulf.

"We are delighted to welcome Essa Al Ghurair Investment and its Sohar Food Cluster Company to Sohar. As part of our agreement, Sohar Food Cluster Company will have the option to begin developing, either by themselves or through joint ventures with international companies, services and industries that are linked to production, initially at Sohar Flour Mill," said Toet.

Sohar Food Cluster Company will be located adjacent to the flour mill and sugar refinery at Sohar, and will be close to the grain storage facility that is being built as part of the food security strategy of the Sultanate of Oman.

As these activities grow, they are expected to contribute to downstream industries and support the growth of dry bulk cargo volumes.

Value added services

"Developing agricultural production and local value added services carries with it the potential to assert greater control over food prices and food security, and create local job opportunities," concluded Toet.

"We are thrilled at this partnership which highlights the growing food demand in a region with a heavy dependence on food imports. With accelerated population growth, this partnership will enhance direct access to Oman and other key export markets in the GCC, as well as Iran, Pakistan, and East Africa," said Essa Bin Abdullah Al Ghurair, Chairman of Essa Al Ghurair Investment.

Essa Al Ghuriar Investment is the second company to sign a deal with SOHAR in the last week, after Dubai's Centre Point Logistics entered into a contract to lease a 50,000 square metre plot as a stepping stone to its planned expansion into Saudi Arabia.