EGYPT – Egyptian wheat imports are forecast to increase further in the marketing year 2010/11 to 10.2 million metric tonnes as the General Authority for Supply of Commodities (GASC) builds reserves in the face of an uncertain domestic and foreign wheat situation.
USDA analysts say that the GASC is anticipating tightening supplies and increased local demand. The USDA predicts that imports will rise from 9.2 MMT to 10.2 MMT which brings it more in line with USDA’s official forecast.
Government statements in the local press indicate that GASC has already purchased 4 MMT of imported wheat which has already been delivered or will be delivered through February 2011.
GASC purchased about 2 MMT of local wheat from the 2010 crop.
The reports also indicate that GASC will need to purchase an additional 1.5 MMT for the remainder of the marketing year.
GASC currently accounts for somewhat more than half of Egypt’s wheat imports. Post lowered domestic wheat production from 8.6 to 8.5 MMT reflecting new estimates.
A new factor contributing to increased wheat demand will be GOE plans to substitute 500 TMT of macaroni for an equal quantity of rice in the ration card program. The USDA analysts increased FSI consumption by 300 TMT to account for this new source of demand which will use 72 per cent flour.
The GOE had faced severe problems in procuring the 88 TMT per month of rice used in the ration card programme.
The GOE has also been under pressure from rice millers and exporters to open a channel for some rice exports, but does not want to see domestic rice prices increase.
By reducing government demand on local rice supplies, the GOE will likely be able to permit some rice sales without impacting prices, although probably not on a one-for-one basis with the macaroni substitution.
The USDA also expects GASC to build up stocks as the wheat supply situation facing Egypt next marketing year is unclear.
It says that stocks will increase from 4.5 to 5.1 MMT.
Sources indicate that domestic planted area for the marketing year 2011/12 crop declined approximately about 100,000 hectares. Yields may also be down because of the lack of availability of high quality seeds.
Approximately 25-30 per cent of the crop was planted with high quality seeds.
The Ministry of Agriculture has announced plans to increase certified seed and other high quality seed production to account for 50 per cent of the planted area in future years. Post is forecasting U.S. sales of at least 3.5 MMT in MY 2010/11. US Export Sales data show that, as of 6 December last year, sales of wheat to Egypt have reached 2.56 MMT, mostly HRW, but with sizeable quantities of HRS, WW, and SRW.
TheCropSite News Desk