Egypt’s private sector dominates wheat imports following state agency changes

Egypt’s private companies are dominating the market for imports following changes to the state buying agency responsible for wheat purchases.

As one of the largest wheat importers globally, Egypt is projected to purchase 12.5 million mt in the marketing year 2024-25 (July-June), according to the United States Department of Agriculture.

Traditionally, the state and private sector have both played crucial roles in imports. In the 2023-24 season, imports under the state-run General Authority for Supply Commodities (GASC) accounted for some 52% of the total wheat imports of 12.3 million mt, and so far in the current marketing year have purchased 3.17 million mt through tenders and private deals.

However, on Dec. 6 the Ministry of Supply appointed Mostakbal Misr, the Egypt Future Agency for Sustainable Development, as the new exclusive importer of food items, taking over the purchasing responsibilities previously held by GASC.

This change has led to the share of imports from the private sector to be greater in January year-on-year as the state focuses on buying wheat from local Egyptian companies with stocks of wheat from international markets, rather than participating in tenders.

According to traders, the state bought around 1 million mt of wheat since December from Egypt’s private companies with stocks of Russian wheat and from local farmers. One Cairo-based trader said Egyptian farmers are restricted to selling to the state, and sales to private companies are discouraged.

Traders have also noted that private companies in Egypt are offering imported wheat at prices $10-$15/mt lower than current import prices, making their products more appealing.

In January, total wheat imports reached 650,812 mt, with private importers accounting for 90% of this volume. The state’s share plummeted to just 63,000 mt, in stark contrast to January 2024, when Egypt imported 688,394 mt, with the state responsible for 84% of the total, according to ship lineups from traders.

One buyer said, “Egypt’s private companies have already established relationships with international sellers, making it easier for Mostakbal Misr to source Russian wheat from the local market, rather than importing themselves.”

However, another buyer cautioned that “this could create a gap in supply.” If the state does not import enough wheat to meet the overall demand while private importers increase their purchases, it may lead to potential shortages and price fluctuations.

Recent spot CIF offers for 12.5% protein wheat to Alexandria port were reported at $255/mt, with a freight spread of $15/mt from Russia to Egypt. Platts, part of S&P Global Commodity Insights, assessed the price of FOB 12.5% Russian wheat for loading in March at $242/mt on Feb. 6.

The dominance of Russian wheat in the Egyptian market continues to be significant. Egypt remains a major buyer of Russian wheat, having purchased 5.3 million mt during the marketing year from July to December 2024.

In January, the share of Russian wheat slightly increased by 1.1 percentage points compared to the previous year to 85.5%. In the coming weeks, an additional 291,200 mt of Russian wheat to be shipped out of the Russian Black Sea port of Novorossiisk to Egypt is currently being loaded or on the road to the Russian port, according to ship lineups from traders.

On the export side, Egypt plays an essential role in regional food security, supplying at least 1 million mt of flour annually to neighboring countries such as Palestine and Sudan amid ongoing conflicts.

Established under a presidential decree in 2022, Mostakbal Misr operates as the development arm of the Egyptian Armed Forces.

Tags: wheat