Prospects on wheat

Ahmed Abdel-Hafez, Tuesday 24 Oct 2023

The government is working to ensure that Egypt’s stocks of wheat remain topped up, reports Ahmed Abdel-Hafez

Egypt could become a hub for distributing Russian wheat
Egypt could become a hub for distributing Russian wheat


Egypt received 30 per cent more wheat from Russia in the first nine months of 2023 compared to the same period in 2022, the US financial service Bloomberg reported this week.

Egypt’s wheat imports surged by 30 per cent in the first nine months of 2023, reaching 8.34 million tons, with 80 per cent of this amount coming from Russia. This was up from 6.43 million tons during the same period in 2022, according to Bloomberg’s Asharq Business service.

The three leading exporters of wheat to Egypt from January to September 2023 were Russia, Ukraine, and Romania, at 6.65 million tons, 1.11 million tons, and 331,660 tons, respectively.

Imad Al-Saei, an expert on transportation and logistics, said that the government was seeking to diversify Egypt’s sources of wheat as the world’s largest wheat importer. This would not mean that Egypt would entirely forgo Russian wheat, and Russia would not be able to afford the loss of the world’s largest wheat-importer, he said.

Al-Saei said that Egypt could become a hub for distributing Russian wheat in Africa. The advent of winter in Russia and Ukraine meant that the two countries were in a hurry to export their wheat in order to reduce the cost of storing it in silos in the cold weather.

This has been reflected in the 30 per cent increase in Russian wheat exports to Egypt, he explained.

The government has also expanded and upgraded Egypt’s wheat silos. There are now 190, with the larger ones storing 17,000 tons of wheat and the smaller ones storing between 5,000 and 8,000 tons. The new silos can maintain the wheat in good condition for 18 months.

Moscow has been looking at Egypt as a worldwide hub for storing, redistributing, and offloading grains for international companies, Al-Saei noted, adding that it has sent giant wheat cargo vessels to Egyptian ports that can take up to 350,000 tons.

On 1 August, the Russian news agency TASS reported that Russian Ambassador to Cairo Georgy Borisenko has said that Moscow and Cairo have designed a system to deliver wheat from Russia to Egypt despite western sanctions against Russia.

Nader Noureldin, a professor of land and water resources at Cairo University, said the price of wheat from Russia and Ukraine was 10 per cent lower than the international market price. Moreover, the proximity of these suppliers to Egypt significantly reduced transportation times, with shipments taking just 10 days to reach Egyptian ports compared to 24 days from the US, 28 days from Argentina, and 15 days from Europe.

In January, tenders to import wheat to Egypt stood at $337 per ton, including costs and shipping. In June, they had reached $229 per ton. In August, the lowest offer came in at $250 per ton, based on delivery on board.

Despite Egypt’s current advantageous position and its increased capabilities at both port and silo levels, Al-Saei believes it will remain challenging to predict the direct economic benefits of this due to the prevailing global economic uncertainty.

This situation necessitates a crisis-management approach that is prepared for potential surprises that may defy global expectations, he said.

Egypt could become a hub for distributing Russian wheat

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