Inconsistent import rules
Due to inconsistent import rules and inspection procedures, the wheat trade in Egypt comes to halt time after time. In 2009, Egyptian Government ordered re-export of Russian wheat supplements brought to the country claiming its quality was very low and not fit for consumption. This was not the first time when wheat trade in the nation had come to halt because of one or the other issue.
In 2016, Egyptian Government once again ordered re-export of foreign wheat shipments and arrest orders of an Egyptian trader citing the reason that there were traces of ergot fungus present in it.
Egyptian Government decided to reinstate its previous policy on wheat imports and decided it would accept only up to 0.05 per cent of the ergot in wheat shipments, in accordance with international standards.
But it had to back down from its earlier claim immediately as it angered its wheat exporting partners. Russia, the largest wheat exporter to Egypt had announced to stop exporting wheat to Egypt.
“The halt in the wheat trade between the two nations would have caused serious social, political and economic crisis in Egypt,” said an Egyptian Trader.
Too much dependency on subsidized wheat
Though authorities in Egypt recently issued guidelines to streamline the wheat trade in the country, the chances of the nation becoming self-sufficient in Wheat ever again in the future still seems bleak. The only solution to tackle this problem seems increasing wheat imports from the global markets.
To decrease its dependency on wheat imports, Egypt is looking to cultivate 3.25 million acres of wheat in the country. This was Agriculture ministry spokesman in 2017 via a statement given to the press.
The food needs of Egypt is above 20 million tonnes but local generation is still inadequate by a wide margin to meet the food needs of the people in the country.
“Government is expecting farmers in Egypt to produce a bumper harvest of wheat. Due to the economic crisis in the nation, it is not possible. Even if agriculture production is increased, due to poor storage and transportation facility, half of the wheat we cultivate is not reaching the market, ‘said Ashraf El Attal, accomplished Egyptian Trader and former President of GAFTA.
Social, Economic And Social Crisis
The farmers in Egypt say that they have never faced such a hard time in the country. They are blaming authorities for social injustice.
“There is no water, we are irrigating our land with sewage. We are facing huge social injustice, the facilities are being provided to rich, the poor farmers are being pushed to black market to purchase seeds, fertilizers and other essentialities for wheat forming,” said a group of Egyptian traders.
The hardest plague to eradicate in the country, though, has been the much deep-rooted corruption. To end the corruption, in 2015, the smart card system was introduced in the country.
Authorities claim that the introduction of smart card system in the country has been a big success saving millions of dollars, reducing dependence on imports and ending wheat shortages, but Egyptian traders believe the reforms taken have failed terribly.
“The system card system has been compromised,” the Supplies Minister Hanafi recently acknowledged it in an interview given to international news agency Reuters