Reduction in Wheat Imports
Egypt, the world’s leading wheat importer, plans to reduce its wheat imports by 17% in 2024. This decision, announced by Egypt’s Minister of Supply and Internal Trade, Ali Al-Moselhi, will lower the import forecast from 6 million tons to 5 million tons. The revision follows an increase in the target volume of domestic grain purchases for the current season from 3.5 million to 3.7 million tons. As of now, the government has already purchased 3.4 million tons and will continue buying from local producers until August 15.
Increase in Domestic Wheat Production
To further reduce dependence on international wheat markets, Egypt aims to expand its wheat sowing areas to 1.47 million hectares by the 2024/2025 season, an increase of 126,000 hectares compared to the previous season. Minister of Planning and Economic Development, Hala El-Said, stated that this expansion would boost the country’s wheat stocks to 5.2 million tons, up from approximately 4 million tons in the 2023/2024 season.
Subsidized Bread Price Increase
On June 1, the Egyptian government raised the price of subsidized bread for the first time in a decade. Due to the local currency depreciation and rising import prices for wheat, the price of bread increased from 4 piastres to 20 piastres. Despite this increase, the price still represents only 16% of the production cost of bread. According to Egypt’s Ministry of Supply, there have been no public complaints regarding this change.
Historical Context
It is noteworthy that in the early 2010s, Egypt and other Middle Eastern countries experienced protests known as the “Arab Spring,” driven by sharp rises in the prices of unsubsidized bread (by 37%) and increasing unemployment. The current situation is being managed more cautiously to avoid similar unrest.
Egypt’s strategic move to reduce wheat imports and increase domestic production is a significant step towards enhancing food security and economic stability. The increase in subsidized bread prices, though modest, reflects the broader economic pressures facing the country. As Egypt navigates these changes, close monitoring of public response and market dynamics will be crucial in maintaining social and economic balance.