Egypt’s Mostakbal Misr inks agreements with European producers to supply wheat

EGYPT – Egypt’s state grain buyer, Mostakbal Misr for Sustainable Development, has signed multiple wheat supply agreements with European grain producers.

As stated in a recent announcement, these agreements aim to secure favorable prices and diversify the nation’s wheat sources. Some of these agreements are barter deals intended to leverage Egypt’s comparative advantages in various sectors.

However, Mostakbal Misr did not provide further details on the agreements, such as the quantity of wheat secured, the prices, and origins.

In 2024, Egypt imported approximately 14.7 million metric tons of wheat, with 74.3% sourced from Russia. The government’s dependence on wheat imports is crucial for supplying subsidized bread to 70 million people. Recently, Egypt has encountered challenges in importing the grain, leading to dwindling strategic reserves.

Mostakbal Misr, established in 2022 by presidential decree, was previously the development arm of the Egyptian Air Force. It replaced the decades-old General Authority for Supply Commodities (GASC) as the country’s strategic grains buyer, a significant change that surprised the global market.

The recent surge in imports suggests a strategic move to enhance the country’s wheat stockpile, ensuring food security amid global market fluctuations.

In August 2024, President Abdel Fattah al-Sisi ordered an unprecedented wheat purchase of 3.8 million metric tons, nearly 20 times larger than usual, due to concerns over potential supply crises stemming from geopolitical tensions in major wheat-exporting countries like Russia and Ukraine.

However, the country managed to secure only 7% of the target volume, as sellers demanded high prices with extended payment terms.

To address these challenges, Egypt is planning to reduce wheat imports by incorporating corn or sorghum into its subsidized bread program, aiming to save millions of dollars.

The new plan, set to start in April 2025, involves mixing corn flour with wheat flour at a 1:4 ratio, potentially saving around one million metric tons of wheat. This initiative is part of broader efforts to manage the financial burden of the bread subsidy program, which has been a significant strain on the national budget.

The recent agreements with European grain producers are part of Egypt’s strategy to diversify its wheat sources and secure more favorable pricing.

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