by PressEgypt is running out of wheat supplies
Egypt’s wheat stocks are limited due to supply cuts
Egypt’s wheat stocks are coming to an end. The country is the largest buyer of grain, but its main exporters were suppliers from Europe, which had to suspend sales due to the geopolitical conflict. Therefore, the government has to look for new partners in order to provide the population with the necessary products.
The crisis in the global food market affects many countries, including Egypt, which has a population of 105 million people. Shortage of grain provokes higher demand for products and higher prices. For a long time, the country purchased wheat through the mechanism of international tenders, where it selected grain at moderate prices from Central and Eastern Europe. As a result of geopolitical tensions and military action on the territory of one of the largest exporters in February, Egypt had to abandon two tenders. This led to a significant depletion of the country’s wheat stocks. According to estimates, they will be enough for an average of 2 months. Experts hope that the local crop will ripen soon and will be able to partially cover the deficit. However, before this Egypt should create a food reserve, which will allow it to insure itself for the next year.
For now, the government is actively working to find ways to buy grain without using tenders. To this end, Egyptian authorities are looking for new suppliers, a likely partner could be India. This country has recently been increasing its exports, helped by last year’s good harvest.
The rise in wheat prices is observed on all exchanges. For example, since the beginning of the year, grain futures in Chicago rose by 46%. This situation worsens the situation of countries that are extremely dependent on imports. There is already a shortage of food in the Middle East and North Africa.
As for Egypt, the problem of wheat is quite acute here. State supplies of this crop are carried out under a preferential program. For a large number of people, bread is sold at subsidized prices. The rise in the price of cereals on the global market puts significant pressure on the continuation of such a program, as it requires large expenditures from the state budget. The situation is aggravated by the fact that the price increase coincided with the holy period in the life of Muslims — Ramadan. In addition, Egypt has been in an economic crisis for a long time, which does not allow stabilizing prices in the domestic market.
Wheat also went up in price on the exchange in France, which also sells grain to Egypt. Cairo cannot afford to buy expensive products, so it is forced to look for various options to save money. Now the options of supplying Romanian wheat are being considered, but the terms of transportation have not yet been agreed upon.