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COP16: A turning point for global land restoration and drought resilience  

This event aligns with the 30th anniversary of the UNCCD and marks the first time its COP will convene in the Middle East and North Africa — a region acutely affected by the devastating impacts of desertification and drought. 
This event aligns with the 30th anniversary of the UNCCD and marks the first time its COP will convene in the Middle East and North Africa — a region acutely affected by the devastating impacts of desertification and drought. 
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Updated 02 December 2024

COP16: A turning point for global land restoration and drought resilience  

COP16: A turning point for global land restoration and drought resilience  

RIYADH: The 16th session of the Conference of the Parties to the UN Convention to Combat Desertification is set to be a pivotal moment in the global fight against desertification and land degradation. 

Scheduled for Dec. 2-13, 2024, in Riyadh, COP16 carries the theme “Our Land. Our Future.”  

This event aligns with the 30th anniversary of the UNCCD and marks the first time its COP will convene in the Middle East and North Africa — a region acutely affected by the devastating impacts of desertification and drought. 

Why COP16 matters 

As one of the three Rio Conventions, alongside climate change and biodiversity, UNCCD plays a critical role in global environmental governance. COP16 aims to catalyze unprecedented ambition and investment to restore degraded lands and enhance drought resilience. 

The conference will focus on several key objectives:  

Scaling up land restoration: Accelerating efforts to restore 1.5 billion hectares of degraded land by 2030. 

Strengthening drought resilience: Enhancing global and national policy frameworks to better withstand and manage droughts. 

Promoting people-centered solutions: Ensuring the participation of local communities, women, and youth in land management and restoration efforts.  

“The COP16 plans to combat land degradation present exciting opportunities,” said Vijay Valecha, chief investment officer of Century Financial, in an interview with Arab News. 

“Land restoration will promote job growth, encourage sustainable development, and support local economies. According to the UNCCD, every dollar invested in restoring degraded lands yields between $7 and $30 in economic returns,” he added.  

Valecha underscored the importance of collaboration in achieving these ambitious goals, stating: “The target to reforest 1.5 billion hectares will require close collaboration among experts, universities, NGOs, government organizations, and the private sector. This collaboration will strengthen knowledge transfer to local communities and grassroots organizations, making development more sustainable in the long term.”  

HIGHLIGHTS

As the hosts, ֱ is also introducing the first-ever Green Zone at a UNCCD COP, aimed at mobilizing the scientific community, businesses, financial institutions, NGOs, and the public to deliver lasting change.

COP16 in Riyadh will host the first dual-track dialogue at a UNCCD COP, combining a negotiation track with an action agenda to address pressing environmental issues.  

The high-level segment of COP16, scheduled for Dec. 2-3, will feature ministerial dialogues on drought resilience, finance, and the impact of land degradation and drought on forced migration, security, and prosperity.  

ֱ’s hosting of COP16 highlights the region’s critical role in addressing desertification and water scarcity. 

The MENA region is one of the areas most impacted by desertification, with some areas experiencing nearly 100 percent land degradation.

‘Missed calls from the land’  

As COP16 in Riyadh approaches, the presidency announced the launch of the global campaign, “Missed calls from the land.”  

This initiative, supported by a campaign film, highlighted ֱ’s commitment as the UNCCD COP16 Presidency to raise global awareness about the urgent issues of land degradation, drought, and desertification.  

Currently, 40 percent of the world’s land is degraded, affecting 3.2 billion people. The UNCCD’s target aims to restore 1.5 billion hectares of degraded land by 2030.  

Valecha elaborated on how land restoration will have far-reaching impacts: “Restoration also improves water retention in the soil, enhances agricultural output, stimulates the livestock economy, and increases water availability for human consumption.”  

He added: “These efforts will create more green jobs, making economies more resilient in the face of climate challenges.”  

Ministerial dialogues  

COP16 in Riyadh will host the first dual-track dialogue at a UNCCD COP, combining a negotiation track with an action agenda to address pressing environmental issues.  

The high-level segment of COP16, scheduled for Dec. 2-3, will feature ministerial dialogues on drought resilience, finance, and the impact of land degradation and drought on forced migration, security, and prosperity.  

“COP16 in Riyadh is a critical moment for the international community to address land degradation, drought and desertification,” said Osama Faqeeha, deputy minister for environment and adviser to the UNCCD COP16 Presidency.  

In a press release, he added: “From food and water insecurity to climate change, conflict, instability, and forced migration, how we treat our land has a profound impact on lives and livelihoods around the world.” 

“In short, we need international solutions. Earlier this year, we achieved a significant milestone with the adoption of a historic resolution by the UN Environmental Assembly to halt land degradation,” Faqeeha added, speaking to Arab News.

As the hosts, ֱ is also introducing the first-ever Green Zone at a UNCCD COP, aimed at mobilizing the scientific community, businesses, financial institutions, NGOs, and the public to deliver lasting change.

Faqeeha highlighted ֱ’s initiatives: “We are determined to lead by example in land restoration and drought resilience, ultimately, showcasing how successful initiatives can create a thriving circular economy.”

He added: “Through the Saudi Green Initiative, we have already planted more than 100 million trees and rehabilitated more than 100,000 hectares of degraded land. This is part of our commitment to restore 40 million hectares through tree planting and other nature-based solutions.”

Faqeeha noted that “the Middle East Green Initiative further demonstrates our regional leadership in restoring 200 million hectares of degraded land across the region.”

“At the same time, we are engaging policymakers from around the world in a range of high-profile discussions to deliver decisive multilateral action. This dual-pronged approach is vital to accelerating the land restoration and drought resilience initiatives our planet and its people so desperately need,” said Faqeeha.

FAO’s central role  

The Food and Agriculture Organization will play a key role at COP16, reflecting its commitment to sustainable land management and food security. Abdul Hakim Elwaer, FAO’s assistant director-general, emphasized in remarks to Asharq Al-Awsat the organization’s active participation, including leading discussions on transforming food systems and coordinating thematic days like Food Day and Governance Day.  

Valecha tied land restoration directly to food security, emphasizing: “Land restoration is crucial for ensuring we have enough food for the future. Sustainable methods like agroecology and regenerative agriculture can improve soil health, reduce carbon emissions, and boost productivity, creating robust food supply chains that adapt to climate change.”  

Strengthening drought resilience  

Building resilience to drought will be a key focus of COP16, emphasizing the role of policies and technologies, with Valecha advocating for proactive measures. 

“To improve drought resilience, a comprehensive framework is needed. This includes identifying vulnerable areas, implementing early warning systems, and enacting policies to prevent water overuse,” he said.  

“Measures such as promoting drought-resistant crops and establishing drought management funds will provide essential protection for affected communities,” Valecha added. 

The integration of local and indigenous knowledge into these efforts is equally vital.   

Valecha said: “Indigenous communities, as key stakeholders in land restoration, possess deep understanding of their ecosystems. Their involvement can significantly reduce deforestation rates, as seen in countries like Nepal and regions in the Americas.”  

A regional and global impact  

ֱ’s hosting of COP16 highlights the region’s critical role in addressing desertification and water scarcity. 

The MENA region is one of the areas most impacted by desertification, with some areas experiencing nearly 100 percent land degradation. COP16 will provide an opportunity for regional countries to showcase their resilience strategies and contribute to shaping global policies.  

“The Gulf and MENA region, owing to its demographics, have been at the center of environmental challenges,” said Valecha. “However, initiatives such as drought and disease-resistant crop varieties by GCC nations demonstrate the region’s commitment to combating these challenges.”  

Moreover, COP16 will offer a platform to showcase innovative solutions, from advanced land management practices to cutting-edge technologies in water conservation.  

Youth and community engagement  

For the first time, COP16 will see ֱ host a Green Zone alongside the formal Blue Zone program. This inclusive public space will promote environmental awareness through family-friendly and cultural activities. 

The emphasis on inclusivity is central to COP16, with forums and training sessions for youth, women, and indigenous communities. The Green Zone will host discussions on sustainable land stewardship while featuring workshops, exhibitions, and interactive art installations.  

Valecha highlighted the potential of youth engagement at COP16: “Selected youth negotiators will participate in the Youth Negotiators Academy, equipping them with skills to advocate for actionable policies. These efforts promote intergenerational dialogue and foster solutions for sustainable livelihoods.”  

“Globally, women account for nearly 50 percent of agricultural labor in small-scale farming. Gender-inclusive policies across the value chain are critical to the success of restoration initiatives,” said Valecha. 

Innovative solutions and partnerships  

COP16 is expected to unveil groundbreaking initiatives, with Valecha anticipating significant developments. He added: “The conference could lead to the establishment of financing mechanisms and restoration funds. Cross-border partnerships can help maintain the Land Degradation Neutrality target and prevent further degradation of land resources.” 

Valecha emphasized the critical role of the private sector in achieving COP16’s goals, highlighting the potential contributions of international financial institutions and private companies. He pointed to favorable loans, green bonds, and funding for sustainable practices such as no-till farming and rotational grazing as key areas of support.  

He also stressed that public-private partnerships are vital for scaling up land restoration efforts. 

A call to action  

As COP16 commences, the world stands at a crossroads. This conference is not just a meeting but a call to action — a chance to turn ambition into tangible solutions for land, livelihoods, and the planet’s future. 


Egypt’s annual inflation slows to 13.9% in July

Egypt’s annual inflation slows to 13.9% in July
Updated 59 min 39 sec ago

Egypt’s annual inflation slows to 13.9% in July

Egypt’s annual inflation slows to 13.9% in July
  • Fruit, vegetable, and meat prices record steep declines
  • Hotels and restaurants recorded a 0.6% increase

RIYADH: Egypt’s annual urban inflation rate eased to 13.9 percent in July, down from 14.9 percent the previous month, as falling food costs helped temper price pressures, official data showed.

Figures from the Central Agency for Public Mobilization and Statistics revealed that the monthly inflation rate declined by 0.6 percent, with the general consumer price index standing at 256.5 points.

The moderation was largely driven by significant drops in key food categories. Fruit prices plunged 11 percent, vegetables fell 7 percent, and meat and poultry were down 4.9 percent. Personal belongings also recorded a marginal decline of 0.5 percent.

However, price increases persisted in some segments. Grains and bread rose 0.4 percent, while dairy products, eggs and cheese each edged up 0.2 percent. Fish and seafood prices also gained 0.2 percent, as did beverages, coffee, tea and cocoa, while mineral water, soft drinks and natural juices climbed 0.8 percent.

Outside the food sector, inflation trends were mixed. Tobacco products saw the steepest rise at 7.8 percent. Clothing and footwear gained 0.3 percent, supported by a 0.4 percent increase in ready-made garments and a 0.2 percent rise in footwear.

FASTFACT

HIGHLIGHTS

Monthly inflation fell 0.6 percent, with the CPI at 256.5 points.

Tobacco increased 7.8 percent, while housing costs rose 0.7 percent.

Some food categories, including grains and bread, posted modest increases.

Housing costs advanced 0.7 percent, driven by a 0.8 percent increase in actual rents and a 1.7 percent rise in home maintenance expenses. 

Furnishings, household equipment and routine maintenance were up 0.7 percent, home textiles rose 2.6 percent, glassware and tableware 0.6 percent, and gardening and household tools 1.2 percent.

Healthcare prices climbed 0.3 percent, reflecting a 0.6 percent increase in outpatient services and a 1.1 percent jump in hospital fees. 

Transportation costs edged higher by 0.1 percent, boosted by a 0.2 percent increase in vehicle purchases and a 0.3 percent rise in private transport expenses.

Communication services rose 0.6 percent, while recreation and culture gained 0.3 percent, supported by higher spending on cultural and entertainment activities and organized tourist trips.

Hotels and restaurants recorded a 0.6 percent increase, with ready meals up 0.5 percent and hotel services up 1.5 percent. Miscellaneous goods and services grew 0.7 percent, led by a 1.2 percent rise in personal care items.


Saudi ports post 12% rise in July container volumes  

Saudi ports post 12% rise in July container volumes  
Updated 31 min 55 sec ago

Saudi ports post 12% rise in July container volumes  

Saudi ports post 12% rise in July container volumes  
  • Increases reflect expansion of trade exchange with global markets
  • Maritime traffic expanded 11.27% to 1,017 ships from 914 ships last year

RIYADH: ֱ’s ports handled 722,502 twenty-foot equivalent units in July, marking a 12.01 percent year-on-year increase as infrastructure upgrades and expanded logistics services boosted throughput. 

According to the Saudi Ports Authority, also known as Mawani, the gain was led by a 35.34 percent jump in transshipment volumes to 175,666 TEUs, while export containers climbed 12.86 percent to 275,098 TEUs. Imports recorded a modest 0.10 percent rise to 271,738 TEUs. 

The July performance follows strong growth in May, when Saudi ports handled 720,684 TEUs, up 13 percent year on year.  

The uptick in activity supports the goals of ֱ’s National Transport and Logistics Strategy, which aims to position the Kingdom as a global logistics hub under Vision 2030. 

In a release, Mawani stated: “These increases reflect the expansion of trade exchange with global markets, the stimulation of sectors related to maritime transport, the enhancement of supply chain efficiency, the growth of maritime activity, the support of the Kingdom’s food security, the expansion of economic activity, and the creation of jobs.”   

Total cargo tonnage, comprising general cargo, dry and liquid bulk, grew 2.81 percent to 21.1 million tonnes from 20.6 million tonnes a year earlier. General cargo reached 461,958 tonnes, dry bulk 4 million tonnes, and liquid bulk 16.6 million tonnes.  

Livestock imports climbed 13.18 percent to 582,708 head. The number of ships calling at Saudi ports rose 11.27 percent to 1,017, passenger traffic grew 41.70 percent to 73,953, while vehicle volumes fell 22.66 percent to 69,969 units.  

Maritime traffic expanded by 11.27 percent to 1,017 ships from 914 ships last year. Passenger numbers climbed 41.70 percent to 73,953 compared to 52,191 a year earlier, while vehicle volumes fell 22.66 percent to 69,969 units.  

In August, Mawani signed an SR500 million ($133.2 million) contract with Petrotank to establish an integrated marine bunkering hub at King Fahad Industrial Port in Yanbu, a project aimed at enhancing fuel storage and bunkering capacity, attracting more vessels, and boosting the competitiveness of Saudi ports.  

Spanning 110,700 sq. meters and operating under a 20-year lease, the facility will boost fuel and oil storage capacity, increase vessel traffic, and strengthen the Kingdom’s competitiveness in global shipping. 


Deflation to shape global outlook despite inflation risks, QNB says

Deflation to shape global outlook despite inflation risks, QNB says
Updated 10 August 2025

Deflation to shape global outlook despite inflation risks, QNB says

Deflation to shape global outlook despite inflation risks, QNB says
  • Bank says global economy has entered new phase characterized by structural fluctuations
  • Shifts in prices of key goods and services remain among most closely monitored macroeconomic indicators

RIYADH: Long-term deflationary forces are set to dominate global trends, interrupted by brief inflation surges triggered by geopolitical and structural shocks, Qatar National Bank has warned. 

In its weekly report, carried by the Qatar News Agency, the bank said the new macroeconomic phase will be defined by structural fluctuations, not a purely inflationary or deflationary environment, with prices periodically jolted by supply disruptions and policy shifts. 

The assessment comes as the International Monetary Fund forecasts global inflation to ease to 4.2 percent this year and 3.6 percent in 2026, even as major economies send mixed signals, with US consumer prices rising 2.7 percent year on year in June and China’s consumer price index edging up to 0.1 percent after months of decline. 

“The bank pointed out that the global economy is no longer stable in a purely inflationary or contractionary environment, but has entered a new phase characterized by structural fluctuations,” QNA reported. 

It said shifts in the prices of key goods and services remain among the most closely monitored macroeconomic indicators, alongside economic growth rates, as they directly impact purchasing power, consumer confidence, investment decisions, and monetary policy.  

Inflation vs. deflation 

While moderate inflation is considered normal and even necessary for economic growth, QNB said excessive inflation or sharp deflation can lead to structural imbalances and long-term economic disruptions. 

The report cited the “Great Moderation” in advanced economies as an example of stable growth under controlled inflation. However, it cautioned that central banks’ aggressive monetary tightening in response to inflation can also trigger recessions or financial stress.  

QNB’s report said some geopolitical development could have deflationary consequences by reducing efficiency and demand, under certain conditions. QNA

On the other hand, deflation — a sustained drop in price levels — often signals deeper structural weaknesses, such as weak demand, financial deleveraging, or demographic decline. While falling prices may seem beneficial at first glance, QNB said they can reduce consumption, delay investment, increase real debt burdens, and trap economies in a low-growth cycle. 

Japan’s “Lost Decade” was cited as a prime example of deflation’s damaging long-term effects, with other major economies facing similar challenges after the 2007-08 financial crisis.  

Post-pandemic uncertainty 

The report said the post-COVID-19 era, combined with supply shocks, led to unusually high inflation, but economists remain divided on whether inflation or deflation will dominate in the medium to long term.  

QNA said “some analysts highlight that one of the main reasons why inflation is returning to the fore as a source of economic concern lies in the disintegration of many structural factors that supported the Great Moderation.” 

Rising geopolitical fragmentation has disrupted global trade, while supply chain reconfigurations, green transition costs, and demographic pressures could keep inflation structurally higher.  

Others believe technology-driven deflationary forces will prevail. Innovations in automation, artificial intelligence, and digital services continue to reduce costs, offsetting inflationary pressures. 

A July report by Morgan Stanley said the ongoing AI wave continues to dominate global markets, with significant investments projected in data centers. 

The report forecasted that global data center spending would reach $2.9 trillion by 2028, covering hardware such as chips and servers, and infrastructure, including construction and maintenance. 

QNB also said some geopolitical developments, including trade fragmentation, could have deflationary consequences by reducing efficiency and demand, under certain conditions.


Saudi industrial output jumps 7.9% in June on manufacturing gains

Saudi industrial output jumps 7.9% in June on manufacturing gains
Updated 27 min 30 sec ago

Saudi industrial output jumps 7.9% in June on manufacturing gains

Saudi industrial output jumps 7.9% in June on manufacturing gains
  • Mining and quarrying, which include crude oil production, increased 6% annually
  • Index of oil activities advanced 7.7% year on year in June

RIYADH: ֱ’s industrial production climbed 7.9 percent year on year to 111.9 in June, driven by a sharp rebound in manufacturing and higher crude output, official data showed. 

Figures from the General Authority for Statistics also revealed a 1.6 percent month-on-month rise in the Industrial Production Index, underscoring momentum in the Kingdom’s non-oil economy. 

The IPI, which measures changes in industrial output across mining, manufacturing, utilities, and waste management, is a key indicator for ֱ’s Vision 2030 diversification drive. 

The June IPI figure, reflecting continued growth in the manufacturing sector, affirms ֱ’s progress in its economic diversification efforts aimed at reducing its decades-long reliance on crude revenues. 

In its latest report, GASTAT stated: “Preliminary results indicate a 7.9 percent increase in the IPI in June 2025 compared to the same month of the previous year, supported by the rise in mining and quarrying activity, manufacturing activity, electricity, gas, steam, and air conditioning supply activity and water supply, sewerage and waste management and remediation activities.”   

Mining and quarrying — which include crude oil production — increased 6 percent annually as Saudi output rose to 9.36 million barrels per day, up from 8.83 million bpd in June 2024.  

The authority revealed that the sub-index for manufacturing activities rose 11.1 percent year on year in June, supported by an increase in the manufacture of coke and refined petroleum products, which jumped 15.3 percent, and the production of chemicals and chemical products, which rose 18.7 percent. 

In May, a separate report released by GASTAT revealed that the Kingdom’s gross domestic product grew 2.7 percent year on year in the first quarter, driven by strong non-oil activity. 

Commenting on the GDP figures, ֱ’s Minister of Economy and Planning, Faisal Al-Ibrahim, who also chairs GASTAT’s board, said at the time that the contribution of non-oil activities to the Kingdom’s economic output reached 53.2 percent — an increase of 5.7 percent from previous estimates. 

The sub-index of electricity, gas, steam, and air-conditioning supply activity increased 5.6 percent in June, compared to the same month in 2024. 

The authority added that the sub-index of water supply, sewerage, waste management, and remediation operations increased 6.9 percent year on year in June. 

Overall, the index of oil activities advanced 7.7 percent year on year in June, while the index of non-oil activities rose 8.6 percent during the same period. 

On a monthly basis, manufacturing activity in ֱ increased 1.4 percent, supported by growth in the production of coke and refined petroleum products, which rose 1.7 percent. 

Compared to May, mining and quarrying activities in the Kingdom also increased 1.9 percent in June. 

Overall, the index of oil activities increased 1.9 percent in June from May, while non-oil activities expanded 1.1 percent during the same period. 

The Industrial Production Index measures changes in industrial output based on the International Standard Industrial Classification framework, covering mining, manufacturing, utilities, and waste management sectors. 

S&P Global data show the Kingdom’s non-oil private sector remained robust in July, with its Purchasing Managers’ Index at 56.3, outpacing the UAE at 52.9, Kuwait at 53.5, and Qatar at 51.4. 


Saudi cement sales jump 21% in Q2 as megaprojects fuel demand

Saudi cement sales jump 21% in Q2 as megaprojects fuel demand
Updated 28 min 15 sec ago

Saudi cement sales jump 21% in Q2 as megaprojects fuel demand

Saudi cement sales jump 21% in Q2 as megaprojects fuel demand
  • Rise driven by local demand, which accounted for 97% of all dispatches
  • Al-Yamama Cement led market in second quarter with 1.93 million tonnes sold locally

RIYADH: ֱ’s cement sector registered a sharp upswing in the second quarter of the year, with total sales by the Kingdom’s 17 producers reaching 13.13 million tonnes. 

According to figures by Riyadh-based Al-Yamama Cement, this marks a 21 percent increase compared to the same period last year. 

The rise was driven almost entirely by local demand, which accounted for 97 percent of all dispatches and increased by 23 percent year on year. Export volumes decreased by 16 percent, accounting for only 3 percent of total cement sales during the quarter. 

“Key drivers based on our market analysis are, first, the megaprojects activation: progress in Neom, ROSHN, Diriyah, and The Line translated into large batch cement drawdowns, particularly in Tabuk, Riyadh, and Eastern regions,” said Amr Nader, cement expert and CEO of UAE-based advisory firm A³&Co. 

Nader told Arab News that another factor was seasonal acceleration. With both Ramadan and the Hajj season falling in the second quarter, periods when construction activity typically slows due to reduced working hours and labor availability, contractors advanced cement purchases. 

Al-Yamama Cement led the market in the second quarter with 1.93 million tonnes sold locally, capturing a 15.2 percent market share. Al-Yamama Cement

The pre-holiday push to meet project milestones and complete concrete pours before the slowdown triggered a temporary spike in local cement sales early in the quarter. 

An inventory depletion strategy is another reason. “Some companies pushed domestic sales aggressively to clear stock before summer fuel adjustments,” added Nader. 

ֱ has been accelerating its Vision 2030 agenda, channeling significant resources into megaprojects and infrastructure developments aimed at diversifying the economy. 

The spending drive has been evident in recent budget reports, where planned increases in government expenditures have contributed to calculated fiscal deficits. According to the International Monetary Fund, these deficits are part of a deliberate strategy to complete priority projects while maintaining fiscal stability. 

Public debt-to-gross domestic product remains within low-risk sovereign thresholds by global standards, supported by ample fiscal buffers and prudent debt management under the Vision 2030’s Fiscal Sustainability Program. 

Company-level performance 

At the company level, Al-Yamama Cement led the market in the second quarter with 1.93 million tonnes sold locally, capturing a 15.2 percent market share. It was followed by Saudi Cement with 1.36 million tonnes, Qassim Cement with 1.14 million tonnes, and Yanbu Cement with 1 million tonnes. 

While local sales soared, exports were comparatively weak. Saudi Cement remained the top exporter with 376,000 tonnes sold abroad, followed by Najran Cement at 50,000 tonnes, and Eastern Province Cement at 5,000 tonnes. 

Nader said increased competition in target markets was a major factor behind the decline in cement exports. “East Africa and Yemen have seen rising local production, such as capacity expansions in Kenya and the reactivation of plants in Ethiopia, alongside aggressive pricing from Turkiye and Iran,” he said. 

Other factors included export quotas and licensing requirements, with several producers choosing to focus on clinker shipments due to their higher margins and simpler logistics, he added. 

Freight disruptions also played a role, as Red Sea security risks forced vessel rerouting, increasing lead times and shipping costs to East Africa and Yemen. This had a greater impact on bagged cement than on bulk clinker. 

Customs and standardization delays in markets such as Sudan, Ethiopia, and Somalia contributed to shipment hold-ups and, in some cases, outright cancelations. 

Saudi Cement remained the top exporter with 376,000 tonnes sold abroad. Saudi Cement

Clinker production and sales 

Clinker production, the precursor to cement, rose significantly during the quarter. Total clinker output reached 14.80 million tonnes according to figures by Al-Yamama Cement, reflecting a 12.6 percent year-on-year increase. 

Saudi Cement was the leading producer with approximately 2.15 million tonnes. As kiln utilization increased to meet rising demand, producers also built up strategic inventories. 

Clinker stockpiles climbed 2.85 percent from the previous year, totaling 134.05 million tonnes by the end of June. Southern Province Cement held the largest inventory, with 20.15 million tonnes in stock. 

Clinker exports outpaced cement shipments during the period. Saudi firms exported 1.63 million tonnes of clinker in the second quarter, marking a 39 percent annual increase. 

The surge in clinker exports from ֱ in the second quarter was driven by a combination of market and operational factors. According to Nader, higher global free-on-board prices, particularly in Asia and East Africa, made exports more lucrative than domestic cement sales. 

Shipping advantages also played a role, as Red Sea constraints proved less problematic for bulk clinker vessels, especially via Yanbu and Jeddah ports. With an estimated 35–38 million tonnes of surplus clinker, producers maximized exports to manage inventories and avoid seasonal plant stoppages, while some benefited from foreign exchange gains through dollar‑denominated sales. 

Key destinations included Bangladesh and Kenya, along with opportunistic shipments to Benin and Ghana, and steady short‑haul supply to Yemen’s grinding units. 

Saudi cement prices among region’s lowest 

“ֱ continues to enjoy some of the most affordable cement prices in the region, largely because of fuel subsidies and domestic overcapacity,” Nader said. 

As of August, retail prices in most Saudi regions range between SR12.5 ($3.33) and SR14 per 50‑kg bag, which is approximately $67–75 per tonne, with the Eastern Region generally at the lower end due to its proximity to production plants and export hubs, Nader added. This stability has held despite stronger domestic sales and rising input costs. 

Qassim Cement sold 1.14 million tonnes locally in the second quarter. File

Regionally, prices are often higher due to different cost structures and supply dynamics. In the UAE, bags typically sell for SR14–SR16, reflecting higher energy and import costs. In Oman, the range is SR13–SR14.5, while in Egypt, prices are SR10–SR11 per bag, though high inflation and currency depreciation weigh on affordability, according to Nader. 

Jordan’s prices reach SR15–SR16, due to limited domestic production and higher operating costs. 

While ֱ’s prices remain competitive, the sector continues to face margin pressures from rising fuel costs and periodic price competition among producers. 

Nader described the situation as mixed across the industry. Average revenues for Saudi cement producers rose 15 to 20 percent year on year in the second quarter, reflecting higher domestic sales volumes and, in some cases, stronger clinker exports. 

However, net profits were flat or down by up to 10 percent for many companies, as gross margins contracted from 26 to 30 percent in the second quarter last year to around 22 to 25 percent this year. 

The squeeze on margins was driven by rising input costs, particularly fuel, Nader said. Energy prices increased in line with ongoing regional fuel subsidy reforms, raising kiln operating costs. 

Several companies also increased their use of alternative fuels, but many of these systems are still in early adoption stages and have not yet delivered the full efficiency gains expected. Meanwhile, logistics bottlenecks, including port congestion and Red Sea freight disruptions, pushed up distribution costs. 

Performance varied significantly by player. Southern Cement and Eastern Province Cement were able to maintain margins, leveraging strong export channels to offset local price pressures. 

Companies like Qassim Cement and Tabuk Cement, which rely heavily on local bagged cement sales and have less flexibility in fuel sourcing, saw sharper profitability declines. 

While the second quarter brought clear revenue gains, persistent margin pressure meant that only the most operationally efficient producers, those with vertical integration, strong export channels, or advanced fuel optimization, were able to turn the sales surge into significant profit growth.