World Grain - November 2013 - 24

Countryfocus

ernment wheat tender list as an official
supplier," it noted.
It explained one reason for Egypt's
high wheat demand. "Egyptians are
among the highest per capita consumers
of wheat with 72% of Egyptian diets consisting of wheat, corn and rice," it said.
Close relationship with russia
Russia has guaranteed to supply
Egypt with wheat. According to an article published by the Egypt Independent on Sept. 18 and translated direct
from the daily newspaper Al-Masry AlYoum, of which Egypt Independent is a
sister publication, "Alaa Qenawy, commercial minister and head of the Egyptian Commercial Representation Bureau
in Moscow, said Russia has pledged to
meet Egypt's needs in wheat through
long-term deals that extend from three
to five years."
In statements to the paper, Qenawy
said that Russia "is expecting a surplus of wheat this year and added that
Egypt's wheat import policy depends on
diversifying import countries."
He also said that Russia wanted to invest in storage in Egypt.
"Al-Masry Al-Youm has learned from
official sources that Egypt has asked
Russia to give grants and aid amounting
to $260 million to build silos.
private and state mills
According to BCE, 126 mills are operated by seven public companies affiliated with the Food Industries Holding Company (FIHC). They mill wheat
purchased through the Cairo-based
GASC (General Authority for Supply
Commodities).
"Public mills often have older, less
efficient technology compared with the
private milling companies," BCE said.
"They also benefit from low or no finance charges nor taxes.
"Egypt's private flour milling sector
uses modern milling technology and
consists of a further 36 private mills
with a total milling capacity of 2.8 million tonnes per year," it said
Egypt's primary flour type is 82%
24

extraction flour mainly used for the
subsidized "baladi" bread, it explained.
"The marketing of this flour is totally
regulated through GASC. According
to GASC, they need to produce 270
million loaves of the subsidized baladi
bread a day to feed the country's lowincome population."
politiCal turmoil
The political changes in Egypt since
the revolution of 2011 and the ouster of
President Mohamed Morsi have created
some problems with supply.
"Most press sources and observers report that Egypt's political crisis is deflating hopes for a quick economic recovery," the USDA attaché said in a recent
report. "With the $12 billion in financial
aid pledged in July 2013 (i.e., loans,
grants, and fuel shipments) from Saudi
Arabia and other Gulf allies opposed to
the Muslim Brotherhood, Egypt's financial collapse was averted.
"Egypt's economic recovery remains
elusive; concerns with security and curfews are causing logistical delays," it
said. "Aid commitments have been instrumental in stabilizing the Egyptian
Pound, improving the country's ability
to pay for vital food and fuel imports on
average amounting to roughly $2 billion
per month," the attaché said. "FAS Cairo estimates that current wheat stocks
(domestic production plus imports) are
sufficient to carry Egypt through January 2014."
The report, dated Aug. 23, said
that since July 2, Egypt's Ministry of
Supply and Internal Trade (MoSIT),
GASC had bought more 1 million
tonnes of wheat, mostly from Ukraine
and Romania.
A Reuters' story quoted Mohamed
Abu Shadi, the country's new minister
of supplies after President Morsi was
removed, as saying that Morsi's biggest mistake was to dramatically reduce wheat imports. Reuters quoted officials as blaming a lack of money and
"a quixotic attempt at making Egypt
self-sufficient."
"Morsi dreamt of making Egypt grow

all its own wheat and allowed imported
stocks to fall to precariously low levels.
It hurt both the country's wheat stocks
and Morsi's government.
"With a quarter of Egypt's 84 million
people living below the poverty line of
$1.65 a day, millions depend on subsidized bread that sells for less than 1 U.S.
cent per loaf," it said. "That supply relies on foreign wheat."
Many people were disconcerted and
unhappy with the government for making statements that we would become
self-sufficient, said Adel Beshai, professor of economics at Cairo's American University.
"Every villager knows we cannot become self-sufficient," he said. "Any illiterate farmer could tell you we could
not be self-sufficient, so people felt they
were being lied to."
small oilseed Crop
According to the attaché, cottonseed,
soybeans, and sunflower seed form the
bulk of Egypt's relatively small oilseed
crop. A report dated at the end of May
puts total cotton planted area in marketing year 2013-14 at 130,000 hectares,
down by over 9%.
"We find that the decrease in total cotton planted area will adversely impact
cottonseed, which at 138,000 tonnes will
be down by 8%," the report said. "Over
the past couple of seasons, we are seeing
farmers shy away from cotton in favor of
the more profitable coarse grains (corn)
and rice cultivation," it said.
It forecast the area and production
of soybeans in 2013-14 "relatively
stable" at about 11,000 hectares and
28,000 tonnes.
"Soybean meal is the Egyptian poultry industry's main feed component,"
it said. "The local poultry industry
remains buffeted by avian influenza.
High feed and fuel costs along with
avian influenza have now shuttered
half of Egypt's poultry farms, leading
to a drop in demand for soybean meal
and other feeds."
The report forecast a 20% increase
in sunflower area to about 6,000 hect-

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