EGYPT – Romania has overtaken Ukraine as Egypt’s second-largest wheat supplier as the North African nation diversifies its import suppliers to minimize the risk of overreliance on few source countries.
Egypt produces approximately 9.8 million tonnes (Mt) of wheat against its annual consumption of nearly 20 Mt.
The country imports the rest majorly from Russia and Ukraine but due to the ongoing war, it has diversified its sources to other international markets to avert a shortage crisis.
Ukraine has always been the second wheat exporter to Egypt after Russia, with the two wheat countries supplying 82% of Egypt’s imports over the past five years.
However, last year, Ukraine’s wheat exports to Egypt were impacted by the ongoing war dropping to 9% from 21% a year earlier, giving Romania an opportunity to raise its own exports to 13%.
Meanwhile, Egypt’s import declined by 18.7% from 11.7 million tonnes (Mt) to 9.5Mt but Romania managed to ship 1.3Mt of wheat to represent 13.6% of the total supply.
The retreat of Ukraine from the global commodity market adversely affected supply leading to a global wheat price surge of almost 60%, hitting the highest level in 14 years.
Despite being at war, Russia is not as adversely affected commodity wise and continues to enjoy its position as the largest wheat exporter to Egypt.
In 2022, the country succeeded in increasing its share of the country’s total imports to 57% against 50% a year earlier, even though volumes fell year-on-year to 5 million tonnes (-6.7%).
According to analysts, Russia intends to dominate the Egyptian market in the 2023 market year as record wheat harvest is expected in the country. The country recently won an Egyptian tender for the delivery of 40,000 tonnes of wheat.
The country also strategizes on further improving the competitiveness of its cereal, which is already the cheapest in the world despite the increase in premiums insurance for transport on the Black Sea.
“ Price is the primary determinant of choice. We launch calls for tenders, we check the free onboard costs, the freight prices and we buy, whatever the origin ”, underlines Ali Moselhy, Minister of Supply.