Egypt’s wheat stocks seen tightening further

With its wheat reserves continuing to decline, Egypt’s wheat imports in marketing year 2024-25 are forecast to increase by 2% over the previous year due to population growth and the availability of more foreign currency in Egyptian banks, according to a report from the Foreign Agricultural Service (FAS) of the US Department of Agriculture.

The report, released April 23, noted that Egyptian banks in March received a large influx of foreign currency from a deal with the International Monetary Fund for $5 billion and a $35 billion investment deal with the United Arab Emirates for projects in Ras El-Hikma.

"As a result of the increased availability of foreign currency, some traders have reported Egyptian banks resolving outstanding payments for grain stuck in ports,” the FAS said.

The FAS forecasts wheat imports in 2024-25 reaching 11.2 million tonnes in Egypt, which always has relied heavily on imports to help to supply its considerable subsidy program that provides low-cost bread to consumers. 

The country’s wheat ending stocks for 2024-25 are expected to slide to 2.48 million tonnes, about half the amount that was in reserve in 2022-23 and the lowest level since 1.85 million tonnes in 2002-03.

With Egypt’s population surging higher — it now stands at 106 million but is expected to reach 124 million by 2030 — increasing production and imports is a top priority of the Egyptian government. Perennially among the world’s top consumers of wheat products per capita, Egypt’s total consumption in 2024-25 is forecast at an eight-year high of 20.65 million tonnes, the FAS said.

The FAS projects 2024-25 wheat production at 9 million tonnes, up slightly from the previous year. 

“Wheat production in Egypt has improved through the development of new breeding and cultivation practices which have led to the spread of new high-yielding varieties,” the FAS said. “Moreover, the use of the raised bed planting method, instead of the old method of planting in basins, has made the largest contribution to an increase in yield.”

Source: World Grain