Harvest 2018: Egypt's disappointments on wheat

Mona El-Fiqi , Thursday 12 Jul 2018

This year’s wheat harvest has not met expectations, with different explanations being offered on why

The harvest season yielded just 3.15 million tons of wheat (Photo: Reuters)

Despite an increase in the land planted with wheat this year, the crop delivered by farmers to the government has been less than last season.

According to figures from the Ministry of Agriculture and land reclamation, the area planted with wheat in 2018 is estimated at 3.26 million feddans compared to 2.9 million last year.

Last year, farmers delivered 3.4 million tons of wheat to the state-operated silos used for storing wheat meant to produce subsidised bread. Due to the increase in wheat cultivation, the government expected to receive more wheat this season.

In April when the harvest season started, Minister of Supplies and Internal Trade Ali Moselhi announced that the government was looking to receive over four million tons of locally produced wheat this year.

However, the harvest season, lasting until the middle of July, has yielded just 3.15 million tons of wheat.

One of the reasons for the reduction could be the sudden changes in climate during the growing season. The weather was unexpectedly hot and then turned cooler accompanied by wind and rain.

Ibrahim Abdel-Moteleb, former director of the Agriculture Research Institute, told Al-Ahram Weekly that the sudden changes in temperature had impacted the harvest negatively. However, certain measures could have been taken by farmers that could have eased the negative effect on the harvest, he said.

Abdel-Moteleb also said that the price of wheat decided by the government could mean even smaller crops in the future. He said that this price was unfair to farmers and did not cover their production costs.

At the beginning of the wheat harvest in April the cabinet announced that the Ministry of Supply and Internal Trade would purchase local wheat at around LE600 per ardeb (150kg).

“This price would drive farmers to stop planting wheat, leading to an even wider gap between production and consumption which has already reached over 10 million tons a year,” Abdel-Moteleb explained.

He said the government should make greater efforts to expand wheat cultivation to meet increases in population and reduce the wheat-import bill.

Egypt has held the position of the largest wheat importer in the world for some years, since it imports large quantities of wheat to fill the gap between local production and consumption.

In 2017, imports of wheat by the state-owned General Authority for Supply Commodities (GASC) reached 7.53 million tons, up from 7.3 million tons in 2016.

Imports by GASC in 2017 accounted for 60.2 per cent of Egypt’s total wheat imports, while private-sector imports registered 4.9 million tons, representing around 40 per cent of the total.

Former minister of agriculture Abdel-Moneim Al-Banna had earlier announced that the price of local wheat at around LE4,000 per ton had been decided in accordance with international prices and that studies had shown that the price was suitable for local production.

However, farmers were not satisfied with the price, since the costs of wheat production, including fertilisers, machinery, rent and the wages of farm workers, have increased, leading to reduced profits.

Ahmed Mustafa, a farmer in the Daqahliya governorate, warned that “unfair prices” could push farmers to grow more profitable crops next season.

“The present price does not cover farming costs and is not equivalent to international prices. The price farmers receive is equivalent to $200 to $230 per ton, while the international wheat price is about $246 per ton,” he said.

Abdel-Moteleb said that linking the local wheat price with the international price was “inappropriate” because production costs were high in Egypt compared to other countries.

“Wheat is a strategic crop, which means that farmers should receive financial support to grow it and thus reduce imports. It would be better if the government bought wheat from farmers at between LE700 and LE800 per ardeb,” he added.

The wheat prices were also unacceptable to the Agriculture Committee of the People’s Assembly, which presented a memo saying that the current price of wheat did not enable farmers to make a profit due to the high costs of production.

The government pays a higher price of around LE4,500 per ton to buy imported wheat of less quality than the locally produced article, it said.

Abdel-Moteleb also blamed the Ministry of Agriculture for not providing enough high-quality seeds, which he said could increase productivity from 18 to 24 ardeb per feddan.

“Good seeds are only available for 30 to 40 per cent of the land cultivated with wheat, and the price of such seeds is higher than most farmers can afford,” he added.

Increasing wheat cultivation would help to save foreign currency as well as achieve food sufficiency in one of the most important staples for Egyptians, he said.

To facilitate purchasing, Moselhi said the ministry had a system that allowed farmers to receive their money within 48 hours of delivery. According to official figures, farmers had been paid dues estimated at LE12 billion.

The Ministry of Supplies had also established a department to process complaints and to ensure accuracy in weighing, he said.

*A version of this article appears in print in the 12 July 2018 edition of Al-Ahram Weekly under the headline: Disappointments on wheat 

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