In November 2015, Egypt’s Government approved the replacement of the existing procurement price policy on wheat with direct subsidies to farmers (FPMA Food Policies), as well as the purchase of local harvest at the average international price during harvest time (April-June).
However, this decision was subsequently reversed and the previous procurement policy reinstated to encourage farmers to increase the wheat area. An import ban on wheat containing ergot - a common grain fungus - was first implemented in December 2015, subsequently lifted in June and, finally, re-enforced on the 22nd of August.
Considering Egypt’s role as the world's largest wheat importer, the Government reconsidered its decision and reverted to the international tolerance level, especially in view of the evident impossibility of guaranteeing zero ergot content inside wheat. On 21st September 2016, the zero-tolerance ban was lifted, reintroducing the international standard that allows up to 0.05 percent of ergot content.
Egypt set the wheat procurement price for the 2017 harvest at EGP 450 per ardeb (150 kilos), 7% higher than in the past years, in terms of local currency, and slightly above the current levels in the international market. However, following the sharp currency depreciation in early November and after the decision of the Central Bank of Egypt to let the Egyptian pound float, the current purchasing price in USD (corresponding to about USD 195 per ton) is significantly lower than last year’s purchasing price of about USD 280 per ton.
As shown by all above data, Egypt’s import sector is now really experiencing a very intense and interesting period. If you need any assistance with the export process to Egypt, we’ll be ready to help you.