Egypt govt to stop wheat purchases from local farmers after reaching threshold

Egypt  is no longer purchasing additional wheat from domestic farmers.

This follows the purchase of  five million tons of domestic wheat, around 25 percent more than the targeted amount, but the figure is still less than last year’s.

In 2015, Egypt bought 5.3 million tons from local farmers.

The ministry said on Saturday it had spent 14.5 billion Egyptian pounds ($1.6 billion) this year as part of a subsidy for farmers, who are being paid a fixed price of 420 Egyptian pounds ($47.30) per ardeb (150 kg) of wheat after Egypt abandoned plans to pay farmers global market rates this year.

The higher fixed price, well above global rates, is meant to encourage farmers to grow wheat but has led to smuggling involving the sale of cheaper imported wheat to the government falsely labelled as Egyptian.

Yasser Hakim discusses Egypt’s challenges to raise wheat production with local farmers.