The Grain Industry Chamber within the Federation of Industries aims to purchase approximately 100,000 tons of durum wheat in the upcoming period, as part of its efforts to meet the needs of local pasta factories. This statement was made by Abdelghafar El-Salamouny, the vice president of the chamber, who confirmed that the chamber has submitted a request to the Ministry of Supply and Internal Trade to obtain the wheat during the current supply season.
El-Salamouny pointed out that several companies operating in the sector, such as Abou Dnql, Sama, and Regina, have submitted applications as part of this initiative. This step is aimed at securing their needs for essential raw materials and ensuring the stability of the production process in the near future.
Event Details
El-Salamouny explained that relying on durum wheat significantly contributes to reducing the gap between local production and consumption, especially with the growing demand for pasta products in the Egyptian market. This increasing demand reflects the local market's need, whether for domestic consumption or for expanding export opportunities to foreign markets.
The vice president of the Grain Industry Chamber emphasized that the local wheat supply season is a fundamental pillar in securing the country's grain needs. The state aims to receive approximately 5 million tons of local wheat during the current season, which enhances the strategic stock and reduces reliance on imports, especially amid global fluctuations affecting trade movements and the prices of essential commodities.
Background & Context
The grain industry is considered one of the vital sectors in the Egyptian economy, playing an important role in achieving food security. In recent years, Egypt has witnessed a noticeable increase in pasta consumption, prompting the chamber to take proactive steps to meet these needs.
It is worth noting that the prices of imported wheat currently range between 14,000 and 14,500 EGP per ton, with expectations of a slight increase next month due to adverse weather conditions affecting the U.S. crop, which could impact production by up to 30%. This situation may reflect on global price movements in the upcoming period.
Impact & Consequences
Flour prices have seen a significant increase this month, rising from approximately 14,000 EGP to between 16,000 and 16,500 EGP per ton at the factory gate. This rise is attributed to the increase in the dollar exchange rate and the rising costs of transportation and shipping, putting additional pressure on factories operating in the sector.
El-Salamouny stressed the importance of encouraging farmers to expand wheat cultivation by providing suitable price incentives and facilitating supply processes. This step is considered one of the main axes to achieve relative self-sufficiency in this strategic crop and reduce reliance on foreign markets.
Regional Significance
Egypt is one of the largest wheat importers in the world, making it vulnerable to fluctuations in global prices. Enhancing local production is a strategic option to ensure market stability and reduce reliance on imports.
In light of global economic challenges and rising import costs, continued state support for this vital issue is essential to ensure the stability of the food security system. Strengthening local production remains the most sustainable option in the long term.