How Egypt Became the World’s Largest Importer of Wheat

Egypt is the world’s largest importer of wheat, spending more than $4 billion annually to feed its population of over 100 million people. Wheat is a staple food in Egypt, used to make bread, pasta, and other products. Wheat imports account for about 60% of the country’s total consumption, while the rest is produced domestically.

Egypt’s high dependence: First reason

The main reason for Egypt’s high dependence on wheat imports is the limited availability of arable land and water resources. Egypt has only about 3.8 million hectares of cultivated land, most of which is located along the Nile River. The country also faces water scarcity, as it relies on the Nile for 97% of its freshwater needs. The Nile’s water flow is regulated by upstream countries, such as Ethiopia, which are building dams and irrigation projects that could reduce Egypt’s share.

Second reason

Another reason for Egypt’s wheat imports is the low productivity and quality of its domestic wheat. Egyptian farmers face many challenges, such as poor seeds, pests, diseases, climate change, and lack of access to credit and markets. The average yield of wheat in Egypt is about 6.5 tons per hectare, compared to 8.6 tons in Turkey and 10.5 tons in France. The quality of Egyptian wheat is also inferior to imported wheat, as it has lower protein and gluten content, which affects the baking properties.

Egypt’s sources of wheat imports

Egypt’s main sources of wheat imports are Russia and Ukraine, which together supply more than 70% of its demand. Russia is the world’s largest wheat exporter, with a market share of 22%. Ukraine is the fourth-largest exporter, with a market share of 11%. Both countries have competitive advantages in wheat production, such as large land area, favorable climate, low labor costs, and proximity to major markets.

However, Egypt’s reliance on wheat imports from Russia and Ukraine also exposes it to geopolitical risks. The ongoing conflict between the two countries over Crimea and eastern Ukraine could disrupt the trade flows and increase the prices of wheat. Moreover, both countries have imposed export restrictions or taxes on wheat in the past to protect their domestic markets from inflation or shortages. This could affect Egypt’s food security and stability, as wheat prices are linked to social unrest and political protests in the country.

Measures to boost domestic production

To reduce its dependence on wheat imports, Egypt has taken several measures to boost its domestic production and consumption. These include:

Increasing the area under cultivation by reclaiming desert land and using modern irrigation techniques.
Improving the productivity and quality of wheat by providing farmers with improved seeds, fertilizers, pesticides, extension services, and mechanization.
Encouraging the consumption of alternative grains, such as corn, rice, barley, and sorghum, which are cheaper and more suitable for local conditions.
Diversifying the sources of wheat imports by exploring new markets, such as India, Argentina, Brazil, and Kazakhstan.
Building strategic reserves of wheat to cope with emergencies and price fluctuations.

Egypt’s efforts to achieve self-sufficiency in wheat are commendable, but they face many challenges and limitations. The country will likely remain a major importer of wheat in the foreseeable future, as its demand continues to grow faster than its supply. Therefore, Egypt needs to ensure that its wheat imports are secure, sustainable, and affordable.

The Global Wheat Market: Trends and Challenges

Wheat is one of the most important staple crops in the world, providing food for billions of people and feed for livestock. Wheat is also a major commodity in international trade, with significant economic and political implications. In this blog post, we will explore some of the trends and challenges facing the global wheat market, focusing on the role of the largest importer and exporter countries.

Egypt: The World’s Largest Wheat Importer

Egypt is the world’s biggest importer of wheat, spending more than $4 billion annually to feed its population of over 100 million. Wheat is essential for making bread, which is a staple food in Egypt and a symbol of social justice. The government subsidizes bread prices to ensure its affordability and availability for the poor. However, this policy also creates a huge fiscal burden and a dependency on foreign wheat supplies.

Egypt produces about 8.7 million tons of wheat per year, but consumes about 20 million tons, leaving a gap of more than 11 million tons that needs to be imported. Egypt mainly relies on wheat imports from Russia and Ukraine, which together cover more than 70 percent of its imported wheat demand . However, this dependence also exposes Egypt to the risks of price volatility, supply disruptions and geopolitical tensions in the Black Sea region.

Russia: The World’s Largest Wheat Exporter

Russia is the world’s largest wheat exporter, accounting for about 20 percent of global wheat trade. Russia has a vast land area suitable for wheat cultivation, especially in the southern and central regions. Russia also benefits from low production costs, favorable exchange rates and proximity to major importers in the Middle East, North Africa and Asia.

Russia produced about 85 million tons of wheat in 2021, and exported about 40 million tons . Russia’s main export destinations are Egypt, Turkey, Bangladesh, Nigeria and Indonesia. Russia’s wheat exports have increased significantly in recent years, thanks to bumper harvests, improved infrastructure and supportive government policies. However, Russia also faces some challenges, such as climate change, pests and diseases, quality issues and export restrictions.

The Future of the Global Wheat Market

The global wheat market is expected to face increasing demand and supply pressures in the future, due to population growth, income growth, urbanization, dietary changes, climate change and environmental degradation. According to the Food and Agriculture Organization (FAO), global wheat consumption is projected to reach 840 million tons by 2030, while global wheat production is projected to reach 790 million tons . This implies a widening gap between demand and supply, which could lead to higher prices and more volatility.

To address these challenges, there is a need for more investment in research and development, innovation and technology transfer, as well as more cooperation and coordination among stakeholders along the wheat value chain. There is also a need for more resilience and adaptation strategies to cope with the impacts of climate change and other shocks. Moreover, there is a need for more transparency and stability in the global wheat trade, as well as more food security and social protection measures for vulnerable consumers.

References:

https://www.fao.org/faostat/en/#data/QCL/visualize

http://www.fao.org/faostat/en/#data/QC/

http://faostat3.fao.org/

https://www.aljazeera.com/news/2022/2/17/infographic-russia-ukraine-and-the-global-wheat-supply-interactive
https://www.indexmundi.com/agriculture/?commodity=wheat&graph=exports
http://www.fao.org/3/i9166en/I9166EN.pdf

https://www.aljazeera.com/news/2022/2/17/infographic-russia-ukraine-and-the-global-wheat-supply-interactive

https://www.arabnews.com/node/2028901/business-economy