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The Egyptian government intends to allow soon the purchase of wheat outside the tenders, said the Chairman of the Board of Directors of the Egyptian Holding Company for Silos and Storage Sherif Basili, confirming what Bloomberg reported, citing informed sources. Basili indicated that a proposal for the resolution is currently before the Council of Ministers, and is awaiting approval.
Under the proposed changes, companies can submit bids directly to the Ministry of Supply, while offers that were not selected in GASC tenders can also be sent to the ministry the next day for consideration, according to Bloomberg. There will be flexibility about the quantities of wheat accepted: the government intends to accept shipments of 50,000 tons for direct purchases, instead of the 55,000-60,000 tons it usually chooses in tenders, according to the sources.
Does this require organizational changes? Reuters quoted unnamed traders as saying that direct offers of wheat may face regulatory obstacles. However, regulatory changes of this kind can be approved by the Cabinet without the need for further action. Egypt is looking to diversify its wheat sources away from Black Sea wheat, and has recently held talks with India, Argentina, France and the United States in this regard. The GASC has 16 countries approved to import wheat, having added Latvia last fall.
India may become a potential supplier of wheat to Egypt: A delegation from the Ministry of Agriculture has arrived in India and is currently examining Indian grain in preparation for the approval of Indian origin for exporting wheat to Egypt, the Ministry of Supply said in a statement to Reuters. “Since the Egyptian delegation is here, it is very clear that they are serious about (purchasing wheat from India),” the chief official of India’s Ministry of Food told Reuters.
Last Monday, the authority issued a limited tender for European wheat, the first time in years that a limited tender was offered instead of opening bids from all 16 approved import countries. The government decided to go to the global wheat market sooner than expected, as the Minister of Supply Ali Al-Moselhi said earlier that Egypt would not put out any tenders before mid-May. Local wheat will boost reserves: The local harvest season started this month. The government aims to spend about 36 billion pounds to purchase 6 million tons of local wheat this year, which is about double what the government spent last year on local wheat.
The country’s strategic wheat reserve is sufficient for 2.6 months, down from the four-month figure announced by the government in early March. Before the outbreak of the war, Russia and Ukraine provided about 80% of Egypt’s wheat imports.
