Al Rawabi to set up $177m dairy production unit in Kizad

Dairy farm will have 10,000 cows and will increase the company's export efforts across the GCC

Al Rawabi has more than 18,000 cattle and produces 450,000  litres of dairy products a day. Jaime Puebla /The National

Kizad, part of AD Ports Group, signed a lease agreement with UAE dairy company Al Rawabi to establish a Dh650 million ($177m) production unit in Abu Dhabi to meet growing consumer demand and boost exports.

Al Rawabi will initially develop two square kilometres in Kizad, with an additional three square kilometres up for development in the future, AD Ports Group said in a statement on Tuesday to the Abu Dhabi Securities Exchange, where its shares are traded.

The dairy farm will have 10,000 cows and increase Al Rawabi's export efforts across the wider GCC region.

Through the agreement, AD Ports Group is advancing the UAE’s National Food Security Strategy by supplying high-quality dairy and food products, while also boosting the nation’s industrial sector, said Abdullah Al Hameli, head of the Economic Cities and Free Zones Cluster at AD Ports Group.

“In addition to supporting the advancement of local farms and creating job opportunities in the local farming sector, our agreement presents a positive boost for regional consumers by offering easier access to fresh produce.”

Al Rawabi's expansion comes as the UAE doubles down on efforts to bolster food security through increased local production.

Last month, AD Ports Group announced plans to develop one of the region’s largest food trading and logistics centres at Kizad.

Covering an area of 3.3 square kilometres, the regional food centre will feature trading pavilions, logistics services, refrigerated warehouses to store food and vegetables, as well as a waste-recycling plant.

Being developed in partnership with the UAE’s Ghassan Aboud Group and Rungis, the project is expected to be ready in 18 months.

It will provide a platform for food importers and exporters, and logistics companies to expand their businesses in the region. It also plans to attract companies to set up their operations in the free zone.

Al Rawabi, which has more than 18,000 cattle and currently produces 450,000 litres of dairy products and 150,000 litres of juice products a day, said the new complex in Kizad will support its expansion.

“Al Rawabi’s investment in Kizad’s food ecosystem will enable us to service a broader scope of consumers — both in the UAE and the wider region,” said Ahmed El Tigani, chief executive of Al Rawabi.

“The strategic location, access to food-related services and readiness of land area in Kizad will help Al Rawabi grow its operations long-term, increasing business reach and potential export across markets."

The production unit will employ 200 people and will include milk parlours, a dairy plant, a maintenance workshop, a feed factory, staff accommodation and a biogas plant. It will also have fertiliser manufacturing amenities that will support the wider agriculture ecosystem in Abu Dhabi.

The company expects to produce 23 million litres in its first operational year out of Kizad and to move about 1,000 containers of goods annually.

Al Rawabi said it will process waste from the project to produce green energy. The project also aims to generate 10 megawatts of clean power through the use of solar panels.

Kizad is a 410-square kilometre industrial zone next to Abu Dhabi’s Khalifa Port, which began operations in 2012.

Located between Abu Dhabi and Dubai, with the deepwater Khalifa Port as its maritime gateway, Kizad supports the growth of sectors such as metals, polymers, food, automotive, water and oil and gas.