EGYPT – The Egyptian Ministry of Finance allocated 45 billion EGP (US$ 1.5B) to purchase local wheat from farmers this year, a step forward in supporting and encouraging farmers to expand the cultivation of strategic crops.
According to Egyprt Today, Mohamed Maait, the Finance Minister revealed the grant in a statement, adding that the allocation surpassed last year’s bill by more than 19 billion EGP.
He added that the government has stated to buy the local wheat from the beginning of this April to the mid-August, with an additional cost to increase the price of one ardab (150 kilograms) by 74%.
The move comes at a time when Egypt is planning to raise local production in line with President Abdel Fattah El-Sisi’s interest in expanding the cultivation of strategic crops, particularly wheat.
Recently, the government cabinet approved new incentives to increase local wheat prices as a measure to support local production and subsequently reduce the import bill of wheat.
According to the decree, the incentives would bring the price of wheat to EGP 1,500 (US$ 48.54) per ardeb (1 ardeb= 150kg), up from EGP 880 (US$16.4).
Egypt has one of the highest per capita consumption of wheat in the world. At 180kg, the country’s per capita is almost thrice the global average.
However, the country, which has been a major wheat importer in the world has been suffering from a crisis of wheat supply from conflicting Russia and Ukraine, the two biggest wheat exporters to Egypt.
This prompted the government to come up with measures to increase the area of the wheat crops by 1.5 million feddans over the few coming years according to a new study conducted by the Egyptian Cabinet’s Information and Decision Support Center (IDSC).
Earlier this month, Egypt signed a grant agreement of €40 million (US$43.5M) with the European Union (EU) in partnership with the Italian Agency for Development Cooperation (AICS) to support the production of wheat in the country.
According to the recent report by USDA, Egypt’s wheat production for MY 2023/2024 is expected at 9.8 million metric tons (MMT) owing to the development of breeding and cultivation practices in the country.
Post forecasts Egypt’s wheat consumption in MY 2023/24 at 20.5 MMT, up by almost 2.0 percent from the MY 2022/23 estimate of 20.1 MMT following the increase in food, seed, and industrial use (FSI) consumption due to the increasing population.
Therefore, the country has devised raft measures to meet the growing demand in a way that contributes to achieving self-sufficiency.