Egyptian wheat imports will rise next season, after the government streamlined its customs regulation, US officials said.
Traders are “optimistic” that a new grain inspection system will bring some clarity to the task of shipping wheat to the world’s top buyer, the US Department of Agriculture’s Cairo bureau said.
Egyptian wheat imports are forecast at 11.5m tonnes, up 0.5m tonnes year-on-year.
The new regulation follows a fraught season for wheat imports, which were disrupted by a shortage of foreign currency to pay for shipments, the sharp devaluation of the Egyptian currency in order to meet IMF stipulations, and a prolonged saga over ergot.
International sellers shunned Egyptian state grain tenders for months, due to uncertainty over acceptable levels of the ergot, with cargoes rejected over even trace levels of the grain fungus.
“Due to the confusion from the controversial ergot policy as well as from confusion about ragweed in imported soybeans that extended through much of 2016, the Government of Egypt restructured its import procedures,” the Cairo bureau said.
GEOIC takes charge
The new rules put a single body, the General Organization for Export and Import Control, in charge of inspection wheat cargoes both at origin and arrival.
“Traders are optimistic with Egypt’s new inspection system and hinted… that dealing with an experienced organization such as GOEIC will be more straightforward,” the bureau said.
“The new process streamlines import regulation because instead of having to deal with up to three governmental bodies, at times at odds with each other, importers now need to engage with one, and this should result in lower costs, which will end up benefiting consumers.”
Stocks to fall
Wheat consumption is seen rising by 1.5% in 2017-18, to 20.00m tonnes.
“The increase is due to an increase in food, seed and industrial use consumption by approximately 2.2%,” the bureau said.
This rise is down to population growth and the presence of some 5m refugees from Iraq, Syria, and other nearby countries.
But feed use is seen dropping, a touch, to 1.30m tonnes.
With consumption higher, and production stagnant at 8.10m tonnes, stocks were seen falling by some 26%, to 25.57m tonnes.