Data: Egypt relied on competitive Russian wheat, with 2022 imports in decline

Data seen by Reuters showed Egypt relied more on Russian wheat imports last year, despite a sharp decline in its wheat imports and moves to diversify its sources of purchase.

Although Egypt’s grain imports from Russia fell by 6.7 percent in 2022, Russia’s share, including purchases by the General Raw Materials Authority prime of the Egyptian government and private sector, rose to 57% from 50% in 2021.

This partially compensated for lower shipments from Ukraine, which accounted for 8.9% of grain imports from Egypt, in down from 28% in 2021.

War in Ukraine has halted grain purchases for Egypt, one of the world’s largest grain buyers, and the government has entered talks with countries including India in a bid to diversify supplies from the Black Sea.

The economic repercussions of the war also caused a currency crisis in Egypt, which led to a slowdown in imports as a whole and the accumulation of goods in ports, as well as the conclusion of a financial support package worth $3 billion from the International Monetary Fund.

Egypt maintains close political ties with Russia, but officials and traders say the preference for Russian grain is driven by the cost, paid in dollars.

Ali Moselhi, Egypt’s supply minister, told Reuters last week that the issue is “price related, of course. We offer and respond FOB (on board delivery system) more goods, and see the lower price of the two and buy.”

Traders said there were some payment complications due to sanctions imposed on Russia as banks are demanding more documents, but Russian wheat remains the most competitive now, with the state catering authority having bought more than 2 million tons in recent months.

“Russian wheat dominates despite all the problems associated with the high cost of ship insurance and the winter weather in the Black Sea,” said a European trader.

Mohamed El-Gammal, grain adviser to the Cairo-based Food and Agriculture Organization of the United Nations (FAO), said total grain imports from Egypt fell by 18.7 % to around 9.5 million tonnes in 2022 amid soaring prices and a currency crisis that has kept private mills and importers from paying. The price of grain stuck in ports. He added that imports hit their lowest level since 2013.

In addition to Russia, shipments from Romania decreased by 35% to 1.3 million mt and from Ukraine by 74% to around 845,587 mt.

The private sector has been able to diversify some of its purchases, with rare shipments arriving at ports from the United States, India and Brazil.

Shipments from France also increased, quadrupling to 1.26 million tons.

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