In early September, one premium rice brand disappeared from the shelves of supermarkets in Egypt, leading some people to speculate that the company had decided to stop production in reaction to the cabinet’s decision to fix the sale price of rice to consumers.
Criticism against the company intensified, with people saying its move might encourage other companies to follow suit in order to put pressure on the government to backtrack on its decision to fix rice prices.
However, the company released statements in several newspapers saying that its production had gone down because farmers and vendors had sold less rice to it. The move was not in reaction to government policy, it added.
On 6 September, the government decided to set the maximum sale price of packaged and unpackaged rice at LE15 and LE12 per kg, respectively. The decision is effective for three months and was based on a memo released jointly by the Ministry of Supply and the Egyptian Competition Authority (ECA) meant to stem hikes in rice prices as some mills and traders had been unjustifiably stocking up on the crop.
Before the cabinet decision, packaged rice had reached LE22 per kg. The decision set one price for all kinds of rice, no matter what its quality.
Sayed Khalifa, head of the Agriculture Syndicate, denied that there had been shortages in rice deliveries. He said that on separate occasions there might be irregular deliveries at the beginning and end of seasons, such as had been the case with the rise in lemon prices to LE100 per kg at the beginning of the season, whereas the price could drop to LE20 when the season was in full swing.
He said that with increases in production, prices go back to normal, and added that Egypt has banned the export of rice over the last four years, meaning that all of the country’s rice production is available for local consumption.
The Ministry of Supply estimates that each feddan of land produces four tons of rice, Khalifa said, adding that the government obliges farmers to supply the ministry with at least one ton for each feddan at a price of LE6,700.
This decision is meant to make available 1.5 million tons of rice annually to be disbursed to ration-card holders.
Farmers are entitled to sell the remainder of their production in the marketplace. This year, a ton of rice reached LE9,000 on the market, according to Hussein Abu Saddam, chair of the Farmers Syndicate.
In Egypt, some 1.075 million feddans are planted with rice, growing four million tons per year. Annual consumption is estimated at 3.5 million tons, Abu Saddam said, noting that the figures indicate there is a surplus of rice of 500,000 tons annually and that the country doe not suffer from a shortage of rice.
*A version of this article appears in print in the 20 October, 2022 edition of Al-Ahram Weekly.