Before the discovery of oil in the 1960s, the agricultural sector was central to Oman's economy. However, in 1999, the share of this sector in GDP was only 3%, and it was heavily subsidized by the government.
The main agricultural area is located along the coast of Al-Batin in the northeast between Muscat and Dibba al-Hisn. In the south of the country, agriculture is concentrated on a small coastal plain, which is fed by monsoon rains coming from the Indian Ocean.
During the COVID-19 pandemic, positive dynamics were observed in the agricultural sector of Oman. The Government's immediate response to the pandemic was to ensure the country's food security. In 2021, the volume of production increased by 7.6% in crop production and by 8.4% in animal husbandry.
The introduction of advanced agricultural technologies and a favorable state policy supporting domestic crop production are key factors stimulating the development of agriculture. In order to reduce dependence on imports, the country strives for self-sufficiency in agricultural products, encouraging the introduction of advanced farming methods.
Crop production in Oman is mainly represented by dates, vegetables, fruits and berries, while other crops are grown in smaller volumes.
According to FAO, over the past 10 years, the total area of agricultural land in Oman has been about 1.4 million hectares — 1.5% of the total area of the country. In 2021, the area of cultivated land was slightly more than 116 thousand hectares, of which 40% were forage crops, 28.9% for fruits, 23.9% for vegetables and 7.2% for cereals. The main agricultural crops of Oman are dates and tomatoes. Fruits such as bananas and papaya are also grown in coastal regions. In addition, Oman has increased the production of barley, sorghum and wheat in recent years.
The Government has put forward a number of initiatives to stimulate production in the private sector, such as updating regulations, providing low-interest loans, promoting domestic production and conducting campaigns to increase awareness of locally produced products, which is expected to contribute to the further growth of agriculture.
Historically, fishing has been the second most important economic activity after crop production. Both the Gulf of Oman and the Arabian Sea are rich in fauna, including sardines, mackerel, tuna, lobsters, oysters and other species of marine life. As a result, Oman produces significant volumes of fish and seafood in 2021. Production reached 922.1 thousand tons. Over the past five years, the volume of production has increased 2.6 times. Such a sharp increase is due to the fact that in 2016 The country has signed a number of agreements for the development of port infrastructure, including the creation of eight new fishing ports.
Oman's dairy industry is well developed — 328.7 thousand tons of milk were produced in 2021. There is also a positive growth trend — the average annual rate for 2017-2021 was 9.6%. There is an increase in investments in projects aimed at the development of the industry and self-sufficiency of the country's market with dairy products. At the same time, Oman's dairy market depends on imported products, such as powdered and concentrated milk.
Poultry meat occupies the first place in the meat industry in terms of production volumes — 130 thousand tons of this type of meat were produced in 2021. It has also become the most dynamically developing industry — the average annual growth over the past 5 years has been 4.0%.
In 2021, the turnover of agricultural products of Oman increased to 5.0 billion US dollars, which is 7.1% higher than in 2020 (4.6 billion US dollars). According to UN Comtrade mirror data, the total volume of imports of Oman's agricultural products in 2021 amounted to 3.9 billion US dollars, showing an increase of 10.3% compared to 2020 (3.6 billion US dollars). The average annual growth rate of imports for 2017-2021 was 6.0%.
According to the results of 2021, milk powder (7.4%), cigars and cigarettes (6.5%), palm oil (6.1%), poultry meat (4.5%), as well as flour confectionery (4.4%) and rice (4.4%) prevailed in the value structure of imports of agricultural products of Oman. Collectively, the top 10 categories accounted for 44.1% of imports.
The main exporting countries of agricultural products to Oman in 2021 were the UAE (29.9%), India (9.6%) and Saudi Arabia (6.6%). In total, the share of the top 10 countries accounted for 73.6% of the value of imports of agricultural products of Oman.
In 2021 Oman imported grain totaling 463.2 million US dollars, which is 0.6% more than 2020 and 12.2% higher than 2017. At the same time, in 2017-2019, imports showed a pronounced increase year-on-year: from 4.9% to 7.5%.
In the structure of Oman's grain imports, the most significant category is rice, which accounted for 37.5% of supplies or 173.5 million US dollars in 2021. Oman also actively imports wheat and corn for 127.9 and 104.7 million US dollars, respectively. In 2017-2021, the value of imports of all crops, except rice and wheat, increased significantly. Thus, there was a 2.4—fold increase in volumes for corn, and a 2.2-fold increase for barley. As a result, the share of corn in the structure of imports has increased from 10.4% to 22.6% in five years, and barley — from 5.8% to 11.4%.
The main grain exporting countries to the Omani market in 2021 were India (supplying mainly rice) and Ukraine (corn and wheat). Their shares at the end of the year amounted to 29.2% and 25.6%, respectively, that is, in total, more than half of the total volume of imports. It should be noted that grain supplies from Ukraine increased 4.4 times compared to 2020, and almost 34 times compared to 2017. The value volume of imports of products of the oil and fat industry of Oman by the end of 2021 amounted to 387.5 million US dollars, which is the maximum value for a five-year period. Compared to the previous year, the increase in imports accelerated to 37.0%, and the average annual growth rate for 2017-2021 was 11.7%.
In the structure of imports of oil and fat products of Oman, palm oil accounts for the predominant share — 61.5% in 2021, which corresponds to 238.3 million US dollars. Compared to the base 2017, imports increased by 1.8 times. Also, the import of soybean oil (2.5 times), other sauces, including mayonnaise and flavoring additives except salt (1.6 times), as well as olive oil (1.9 times) demonstrated a high increase over five years.
The main exporting countries of the oil and fat industry products to the Omani market in 2021 were Indonesia and Malaysia (almost the entire volume accounted for palm oil) and the UAE with a wide range of supplies. The listed top 3 countries accounted for 72.4% of the value of imports, and the top 10 countries accounted for 95.2%.
During 2017-2021, Oman's meat imports were at the level of 310-330 million US dollars, with the exception of 2020, when the volume decreased to 252.8 million US dollars.
However, already in 2021, imports reached 315.5 million US dollars, an increase of almost a quarter compared to the previous year.
In the structure of Oman's meat imports, poultry meat is the leading commodity position — in 2021, it accounted for 55.5% of deliveries or 175.2 million US dollars. At the same time, poultry meat imports decreased by 7.4% in dynamics over five years. Imports of beef and by-products of cattle, on the contrary, increased by 16.2%, reaching 82.0 million US dollars by the end of 2021.
The key exporter of meat to Oman during 2017-2021 was Brazil, almost the entire volume of supplies of which fell on poultry meat. Brazilian products accounted for 45.2% of Oman's total meat imports in 2021. Another 15.0% accounted for meat imported from India — mainly beef and edible offal of cattle. The combined share of the top 10 exporting countries in Oman's imports was 92.3%.
During 2017-2021 . Oman annually imported milk and dairy products worth about 550-600 million US dollars. In 2021, the volume of deliveries amounted to 579.3 million US dollars, and compared to 2017, the value of imports increased by 5.6%.
In the structure of imports of milk and dairy products, about half of the volume is occupied by powdered milk. In 2021 Oman imported milk powder in the amount of 289.0 million US dollars, since 2017 imports have increased by 25.8%.
Other items that have shown positive dynamics over the past five years are ice cream, as well as butter and other dairy fats — the volume of deliveries of these categories increased by 1.6 and 1.5 times, respectively. In turn, the supply of cheeses, concentrated milk and fermented milk products decreased.
According to the results of 2021, three leaders stood out in the structure of Omani imports of milk and dairy products by country: New Zealand, Saudi Arabia and the UAE, each of which accounted for 19-21% of supplies. In addition, milk and dairy products are imported to Oman from EU countries, as well as from Egypt and India.
According to UN Comtrade, the total volume of exports of Oman's agricultural products in 2021 decreased by 3.4% compared to the previous year to 1,029.5 million US dollars. During 2017-2021, exports were almost stable, and the average annual growth rate for 2017-2021 was only 0.8%.
The structure of Omani agroexport is characterized by a high degree of diversification: over 10% of the supply structure in value terms is occupied by only two types of products — frozen fish (13.2%) and flour confectionery (11.0%).
In addition to frozen fish, Oman also supplies foreign markets with fish flour, unsuitable for food (6.7%), fats and oils from fish and marine mammals (4.3%), fresh and chilled fish (3.6%) and shellfish (3.4%).
In 2021, more than half of Oman's agricultural exports accounted for neighboring The countries of the Persian Gulf are the UAE (27.9%) and Saudi Arabia (26.5%). Oman also exports products to Qatar (10.1%), Malaysia (4.0%) and Thailand (3.9%).
As a result of the closure of catering establishments during the quarantine period, the demand for rice, pasta and noodles in the retail trade increased significantly in the country, which ensured their status in the list of essential goods for all consumers and led to the accumulation of stocks of goods in anticipation of a possible shortage.
There are different types of pasta on the market — wholegrain, made of various types of flour, gluten-free, with the addition of vegetables, which reflects the trend for a varied diet and a healthy lifestyle. The popularity of Mediterranean cuisine and Italian pasta, in particular, is also growing in the country.
In recent years, the demand for alternative protein products has increased in Oman, dairy products based on soy and other legumes are becoming popular, and there is also a demand for vegetable meat.
Consumers in Oman are increasingly opting for healthy foods and, in addition to the usual sunflower oil, use cold-pressed olive oil, avocado oil, as well as various oils with the addition of vitamins and minerals.
Manufacturers of products, taking into account the growing trend for healthy lifestyle, produce vegetable oils with a lower percentage of fat content and with a reduced cholesterol content. The most popular volumes of vegetable oil bottles for home consumption are 750 ml, 1 l, 1.8 l, 3 l; for HoReCa — 5 l, 20 l.
The most popular types of meat in Oman are chicken and beef, they are an integral part of the national cuisine, as well as an important component of national religious holidays. Next in popularity is lamb.
The development of the restaurant sector is an additional driver of demand for beef and chicken: new steakhouses are opening in the country, which offer consumers premium cuts of beef, as well as increasing their presence of fast food establishments where beef patties, minced meat, chicken legs and wings are popular.
There is a growing demand for organic and farm meat with "eco" signs, butcher shops are opening across the country, where visitors are offered a wide selection of meat products for every taste. Consumers appreciate in such stores the opportunity to choose any cut they need and are willing to pay a high price for such meat.
The growth of investments aimed at expanding Oman's dairy sector and ensuring its self-sufficiency are the main trends contributing to the development of the industry in the country. The dairy market of Oman is dominated by producers of milk and dairy products from Saudi Arabia, as well as local players.
The growing demand for drinking milk, cheese and yogurt due to their positive health benefits, along with an increase in the number of flavors for yogurt and milkshakes, is driving the growth of the industry.
Fish and seafood are in high demand in Oman due to their geographical location, as they form an important part of the diet of the country's population. Crabs, squid, oysters, lobsters, vongole, mussels are the most popular among seafood.
Of the fish, the most popular types in the structure of consumption of Omanis are tuna, horse mackerel, sea bass, dorado, parrot fish and capelin, salmon, but the latter are mostly imported. In addition to traditional local dishes that include fish, the development of the hotel and restaurant sector is an additional factor that stimulates the demand for these products.
