Egyptian farmers start to collect their wheat harvest in April each year, but this year there is a difference in that the government is hoping to collect half the country's needs from local farmers in order to save the country's dwindling foreign currency reserves that have to be paid out on imports. According to Ministry of Agriculture Figures, this year land allocated to cultivating wheat is estimated at 3.4 million feddans, producing some nine million tonnes of wheat. At present, domestic wheat production covers less than half of Egypt's total annual consumption, the rest of it coming from importing around 10 million tonnes of wheat from abroad and making Egypt the most important wheat importer worldwide. Egypt this year hopes to cut imports by 10 per cent by growing a bigger home crop and modifying the storage capacity it uses. In this way, the government hopes, Egypt will be able to keep the country's 84 million people fed with the subsidised bread that cost the state budget some LE20 billion in fiscal year 2012/2013. “The former regime's policy was never in favour of the local wheat crop, and it treated farmers badly as it used to humiliate Egyptians in general. However, that era has now come to an end,” Bassem Ouda, the minister of supply and internal trade, said. The government is aware of the importance of wheat as a strategic crop, he said, and it was setting out a package of measures that aimed to encourage farmers to deliver their wheat to state-owned silos. The programme began some months ago when the government announced that the delivery price of wheat this season would be LE400 per ardeb (about 150 kg) and LE2,680 per tonne. This is considered a fair price since it is 15 per cent higher than the current international price. In a recent press conference a comprehensive plan for wheat production was announced by the minister, who said that President Mohamed Morsi was following the application of the plan himself. The plan included guaranteeing good prices for farmers, paying them in cash, providing extra collection points in villages that were within easy reach of farmers, giving prizes for higher wheat producers, and modifying storage capacities. A higher committee has been formed of representatives from the Ministry of Supply and Internal Trade and agriculture and land reclamation, as well as from the Bank of Development and Agricultural Credit in each governorate, to follow up the delivery process and ease the problems facing farmers. To guarantee the financing of wheat delivery, LE250 million has been allocated through branches of the Bank of Development and Agricultural Credit throughout the country, and this will be used to pay farmers in cash on delivery. Ouda said that farmers had used to complain that the state-owned silos were far away from their villages, so “we decided to set up extra collection points in almost every village to ease the transportation of the wheat.” A hotline has been set up to deal with any complaints during the delivery process, and Ouda said that any problems would be dealt with in real time, while at the same time urging society as a whole to assist in the delivery process. He said that the government would not hesitate to apply severe penalties under Law 95 which prohibits the trading of locally produced wheat if the state is not able to cover its needs for wheat to produce subsidised bread. “It is a matter of national food security,” Ouda said. Prizes would be given to farmers delivering the largest amounts of wheat, he said, with LE1 million being given to the governorate that handed over more than 50 per cent of its total wheat production. The government is aiming to collect 4.5 million tonnes of wheat over the next six weeks, up from around 2.4 to 3.7 million tonnes in previous years. Ouda said that this was a dream “that can be realised,” adding that the Bank of Development and Agricultural Credit was ready to receive 2.1 million tonnes and the state Silos Holding Company would take 1.4 million tonnes. State flour mills were ready to deal with one million tonnes, he said, and every day the government was expecting to receive 50,000 tonnes of locally produced wheat. Egypt's farmers had already reacted positively to the new moves, Ouda said, adding that Aswan had already delivered 10,000 tons of wheat during the campaign's first week. The government's moves to promote the production of domestic wheat have been praised by some experts. Ashraf Abbas, a professor of agriculture at the Agricultural Research Institute, said that a significant increase in wheat production could be achieved through a proper pricing policy and that this would also lead to improvements in agricultural research. “A suitable pricing policy encourages farmers to cultivate more land, while research has helped to increase productivity from eight ardebs per feddan in the 1990s to 18 ardebs per feddan today,” he said. However, some observers believe that the government is being over-optimistic in its expectations. Ali Abdel-Rahman, chair of the Arab Union for Sustainable Development and the Environment, said that every year the government announced its targets, but these were never achieved. “We are waiting to see what happens. The amount of wheat collected by the government will be announced by the end of May,” Abdel-Rahman said. He agreed that the Ministry of Supply's new mechanisms were good ones, but said that corruption in the system might not allow the government to collect its needs. “We hope that the government will be able to achieve its 4.5 million-tonne target, but in past years the wheat delivered to the state has never reached three million tonnes.” Abdel-Rahman gave various examples of corruption. Since the government's delivery price is higher than the international price, traders import large quantities of lower-quality wheat and deliver them as locally produced, pocketing the difference in price. To guarantee the success of the new plan, there should be significant control of the whole process, Abdel Rahman said. “A corrupt employee in the state-owned silos might refuse to receive wheat from a farmer who has no alternative but to sell his crop to a trader even at a lower price instead of taking it back home,” he added. Though trading in local wheat is prohibited unless the government meets its needs, Abdel-Rahman said that wholesalers were also now collecting wheat. “It is a clash of interests. Traders buy wheat at higher prices than those offered by the state in order to store it and fix prices in the local market. The needs of private-sector bakeries and pastry shops are estimated at six million tonnes annually,” he said. Abdel-Rahman said that the government plan lacked concrete steps, and forming a committee to follow up the delivery process was not enough. The members of this committee should be provided with facilities such as vehicles in order to ease movement from one village to another and they should have enough money to prevent employees from being corrupted, he said. A further negative point mentioned by some experts was that the plan was not suitable for long-term use. To cover local needs, the plan should also increase the amount of land given over to wheat cultivation and should set up a further 50 storage silos, Abdel-Rahman said. The annual increase in Egypt's population was one million people, and these would need another 0.75 million tonnes of wheat. To help achieve self-sufficiency in wheat, Abdel-Rahman said that a comprehensive agricultural policy should be introduced to guarantee the cultivation of wheat over large areas of not less than 100 feddans, which would facilitate the harvesting and transportation of the crop.
