WHY IT MATTERS: Egypt is a major wheat importer and its purchases affect world prices

Egypt is one of the world’s largest importers of the cereal, relying heavily on those from Russia, Ukraine and the European Union. The USDA attaché forecast Egyptian wheat imports for 2026/27 at 12.50 million tonnes, down 200,000 from the year before. That’s due to the Cairo desk having projected Egypt’s wheat output increasing by 600,000 tonnes at 9.80 million.

The attaché said harvested wheat area expanded by 170,000 hectares at 1.50 million in 2026/27 because of higher domestic prices. However, for that crop year, projected Egyptian wheat yields were to fall to 6.53 tonnes per hectare from 6.92.

There’s to be a jump in Egypt’s total supply in 2026/27, at 26.07 million tonnes versus 24.77 million in 2025/26.

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Although a major importer of wheat, Egypt is also an important exporter of wheat flour, especially to several African and Middle East countries. Exports in 2026/27 are expected to improve by 200,000 tonnes at 1.20 million tonnes.

The country’s wheat ending stocks are forecast to increase to 4.57 million tonnes from 3.77 million in 2025/26.

As for other crops, the Cairo desk said Egypt is expected to grow more corn with production bumping up to seven million tonnes in 2026/27, with imports also edging up to 10.50 million. There’s to be a small uptick in ending stocks at 1.79 million tonnes.

The attaché projected Egyptian milled and rough rice production to remain at 4.20 million and 6.09 million tonnes, respectively in 2026/27. The rice carryover is set to increase to 671,000 tonnes from 491,000 in 2025/26.

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If Egypt is able to buy wheat at knock-down prices, the lower import bill could help in efforts to keep the economy afloat.

The country has needed the support of the International Monetary Fund and friendly Gulf countries who have injected billions of dollars in loans and investments in 2024 alone.

“My colleagues (at the government) are seizing this opportunity to buy what we need amid the current situation in the global market,” Finance Minister Ahmed Kouchouk told reporters on Tuesday, adding that not all repercussions of the global sell-off wave were negative.

The tender marked a change in the purchasing strategy of state grains buyer, the General Authority for Supply Commodities (GASC), which typically is for one or two months rather than for the October to April shipment period covered in this tender.

Egypt has been one of the world’s largest wheat importers, mainly to provide subsidized bread for tens of millions of its people. GASC alone imports some 5.5 million metric tons of wheat annually for bread subsidies.

Egypt typically imports most of its grain from Russia, which made up nearly 70 per cent of all its wheat imports in 2023.

Traders expect GASC to buy from Russia and other Black Sea origins in the upcoming tender.

“This is a very strange tender,” said one trader. “We usually submit bids for shipping a month or two in advance. It would be very difficult to submit a freight offer six or seven months in advance.”

Some traders were sceptical about Egypt’s ability to fulfil its ambition.

“I doubt if they will be able to get the full volume,” said another trader. He said the 270-day payment term was off-putting.

A third trader said trading houses will want the business and will just add the banking costs of the 270-day payment delay to their price offers.

GASC said it aims to maintain a wheat reserve sufficient to meet nine months of demand, with reserves in July standing at 6.9 months.

“It appears that Egypt wants to get big supplies in storage or at least in its books. This could be due both to Egypt’s financial problems or the threat of greater war in the Middle East,” a European trader told Reuters.

“They could shoot themselves in the foot by buying in advance but then having to regret if prices fall later.”

Shortly after GASC’s announcement, European wheat futures rose on Tuesday.

—Reporting for Reuters by Sarah El Safty, Nadine Awadalla, Mohamed Ezz and Michael Hogan

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Wheat traded higher, supported by global demand and concerns about Canada’s crop.

Corn was near even as traders wait for the harvest to assess yields.

The most-active soybean contract on the Chicago Board of Trade (CBOT) lost 5-3/4 cents to $13.86-3/4 a bushel (all figures US$).

CBOT wheat gained 6-1/2 cents, to $6.07 a bushel, while corn ended six cents lower at $4.80-3/4 a bushel.

Recent export activity pushed soybean futures to one-month highs on Monday as U.S. stockpiles tightened, though global supplies remain ample.

“When you look at the soy complex, the tightness is only in the United States. The rest of the world is well supplied on soybeans,” said Karl Setzer, commodity risk analyst at Agrivisor. “Plus it’s seasonal. We’re going to start soybean harvest in the United States within a couple weeks.”

The U.S. Department of Agriculture confirmed private sales of 266,000 metric tonnes of U.S. new-crop soybeans to unknown destinations.

Soybeans are trading at their highest levels relative to corn since late 2016, which could lead to overproduction of U.S. soybeans in the coming years, moderating prices.

Corn eased as meagre demand was further stifled by low water levels on the Mississippi River which could slow movement of grain to the Gulf of Mexico.

Wheat was buoyed after falling to two-week lows, as the U.S. crop becomes more affordable versus bigger global suppliers. Still, ample supplies from bigger exporters like Russia and the European Union remain more competitive.

“There’s still enough wheat. We’re not going to be in the market yet,” said Mark Schultz, chief analyst at Northstar Commodity.

Egypt’s state grains buyer, the General Authority for Supply Commodities (GASC), has bought 240,000 tonnes of wheat in an international tender, comprised of half French wheat and half Romanian wheat.

Damages to durum wheat crops from drought in Canada, combined with adverse weather in Europe, are likely to lead to higher pasta prices, producers said.

Wheat production in Canada fell by 14.2 per cent in 2023 compared to 2022, a Statistics Canada survey showed on Tuesday.

Data showed that soft wheat exports from the European Union were down nearly 30 per cent so far in the 2023-24 season.

— Reporting for Reuters by Christopher Walljasper in Chicago; additional reporting by Naveen Thukral, Peter Hobson and Sybille de La Hamaide.

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Corn was also pressured by promising early crop tour results, but found support in a recent spate of export sales.

Wheat ended higher as global demand remains strong, though an unexpected decline in U.S. spring wheat conditions added supply risk pressure.

The most-active soybean contract on the Chicago Board of Trade (CBOT) fell 15-3/4 cents to $13.46 a bushel (all figures US$).

CBOT wheat added two cents to $6.27-1/2 a bushel, while corn dipped three cents to $4.79-1/2 a bushel.

Ohio corn yield prospects and soybean pod counts are above last year and higher than the three-year average, scouts on an annual tour of top U.S. production states found on Monday.

“If we have better day one stuff, people are going to assume it for day two. So I think that’s why we have the selling today because they’re trying to get ahead of it,” said Joe Davis, director of commodity sales at Futures International.

However, the U.S. Department of Agriculture’s crop ratings, released after Monday’s close, fell below expectations.

For soybeans, 59 per cent of crops were rated good to excellent, below the average analyst expectation of 60 per cent.

Corn fell one percentage point to 58 per cent, versus an average expectation that the rating would be unchanged.

The spring wheat rating dropped by four points to 38 per cent, against an expectation it would also be unchanged.

Crops in central U.S. crop belts are facing sweltering temperatures amid limited rainfall.

“Four days of terrific heat, that’s pushing the crop to maturity. We know that, when you push a crop to maturity, that’s usually at the expense of yield,” said Don Roose, president of U.S. Commodities.

Losses in corn were muted by a third consecutive day of U.S. corn export sales to Mexico.

The wheat market was bolstered by demand optimism, after Egypt bought 60,000 metric tonnes of Romanian wheat on Tuesday.

Competition from Russian exports has curbed wheat prices in recent months and offset worries about war disruption to Ukrainian supplies.

— Reporting for Reuters by Christopher Walljasper; additional reporting by Gus Trompiz in Paris and Naveen Thukral in Singapore.

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Around 700,000 tonnes of wheat haven’t been released from customs, causing around 80 per cent of mills producing commercially sold bread, pasta, and other goods to “cease activity completely,” according to a Sept. 26 letter from the Federation of Egyptian Industries’ Chamber of Cereals to the supply minister.

While global wheat prices have fallen to their levels before the Russia-Ukraine war, prices in Egypt have risen due to depleting stocks, said Hussein Boudy, the chamber’s deputy head.

Egypt’s importers can no longer replenish their wheat stocks amid a dollar shortage caused by a rising import bill and decreasing tourism revenues from two of its largest markets — Ukraine and Russia. Loss of confidence in the Egyptian pound by investors also contributed to the shortage.

Wheat prices rose by around 10 per cent to 9,000 Egyptian pounds (C$618.42) per tonne in the last two weeks, Boudy said, while some traders reported steeper rises of up to 15 per cent. Flour also rose by 18 per cent to 11,500 pounds (C$790.15) per tonne, traders said.

“Bigger mills… used to store for a month and a half or two, but today some mills have stocks for seven to five days.” said Walid Diab, managing director of the Egyptian Millers Company. “We are in the red zone.”

Boudy added that one company had requested to purchase from the state grains buyer’s strategic reserves.

The government “will work on the issue” of declining private sector wheat stocks, Egypt’s supply minister told Reuters on the sidelines of a conference on Sunday.

Supply crunch

As foreign currency reserves dwindled, authorities introduced rules in March that restricted access to dollars for imports.

Although wheat and other strategic goods were exempted, private sector traders say wheat import payments have nearly stopped since September and no new contracts have been signed.

Imports of corn, poultry and soybeans have also been affected, traders say.

“Suppliers understand that there’s an issue with Egypt but now they don’t want to do new business until the old stocks are released,” said one local trader.

Since early September, only 2,000-3,000 tonnes of wheat got through customs, the Chamber’s letter said. Monthly private sector needs are estimated at around 450,000 tonnes, and, according to the Chamber, mills need the immediate release of around 300,000 tonnes.

The supply crunch has caused a spike in the price of bread in some bakeries, said Hesham Soliman, a Cairo-based private sector trader.

There were no signs of shortages at bakeries, said Attia Hammad of the Cairo Chamber of Commerce, though he said some bakeries could hike prices or decrease the weight of loaves because of rising costs.

Egypt, with a population of 104 million, is typically the world’s biggest wheat importer. Private sector imports recently overtook those by the state buyer, which purchases wheat for a large subsidized bread programme.

— Sarah El Safty is a Reuters commodities correspondent in Cairo.

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“We are just running into a bit of technical resistance across the board,” said Dan O’Bryan, a risk management specialist and broker at Top Third StoneX. “You have got to feed the bull everyday.”

The losses in corn, which had posted gains in the six previous sessions and hit the highest in nearly two months on Wednesday, were limited by concerns about potential harvest shortfalls in the U.S. Midwest.

Corn yield prospects in western Iowa are lower than last year, scouts on an annual tour of top U.S. producing states found on Wednesday. Illinois corn yield prospects are also lower than last year but above the three-year average.

Chicago Board of Trade November soybean futures settled down 25-3/4 cents at $14.31-1/4 a bushel (all figures US$).

“We got a decent sell off, aided and abetted by the market running headlong into chart resistance,” Charlie Sernatinger, global head of grain futures at ED+F Man Capital, said in a note to clients.

CBOT December corn dropped 7-1/4 cents to $6.50 a bushel.

Bumper U.S. crops are needed to offset low global grain supplies, but extreme heat and widespread drought in parts of the Midwest have hampered fields and a string of troubled crop harvests worldwide are pointing to multiple years of tight supplies and high food costs.

CBOT December soft red winter wheat was 24-1/4 cents lower at $7.89 a bushel, with concerns about global demand adding pressure.

Egypt, one of the world’s largest wheat importers, is believed to have made no purchase of imported wheat in talks with trading houses on Wednesday, traders said. The General Authority for Supply Commodities considered prices offered as too high, they said.

— Mark Weinraub is a Reuters commodities correspondent in Chicago; additional reporting by Rajendra Jadhav in Mumbai and Sybille de La Hamaide in Paris.

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The Razoni set sail from Ukraine’s Odesa port on Aug. 1 under a deal brokered by the United Nations and Turkey between Russia and Ukraine. Eleven other ships have left since then.

While the Razoni was initially headed to Lebanon’s Tripoli, Ukraine’s embassy in the country said the buyer had refused delivery due to a five-month delay and the ship was looking for a new customer.

The ship, which had since been at anchor off Turkey’s southern coast, entered the port in Mersin Thursday afternoon, Refinitiv ship tracker data showed.

Kadir Soyer, agency director at Mersin-based shipping agent Toros, said the ship would offload 1,500 tonnes of corn in Turkey and later continue to Egypt with the rest of its 26,527-tonne load.

“1,500 tonnes will be offloaded in Mersin and the rest will go to Egypt,” he told Reuters via phone.

Toros was only handling the docking and offloading in Turkey and would not be involved in the ship’s trip to Egypt, he said.

— Reporting for Reuters by Ali Kucukgocmen in Istanbul.

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“The Ukraine crisis is creating shock waves when it comes to supply chain and especially food security and impacting the most vulnerable at the most difficult time,” said Harjit Sajjan, minister of international development.

“We are making adjustments to reflect this… People are going hungry because the prices of food have gone up,” Sajjan told Reuters in an interview in Jordan, the first leg of a regional tour that also takes him to Egypt and Lebanon.

He did not give the new aid figure but the Ottawa-based Canadian International Development Platform said there was a 27 per cent rise in foreign aid last year to around $6.6 billion.

The United Nations has said a global food crisis fuelled by conflict, climate shocks and the COVID-19 pandemic is growing because of the ripple effects of the war in Ukraine driving rising prices of food, fuel and fertilizer.

Over 50 million people in eastern Africa will face acute food insecurity this year, according to a new study backed by the U.N.’s World Food Program (WFP) and Food and Agriculture Organization (FAO).

Sajjan said Canada is boosting aid to the WFP, whose annual requirements have reached an all-time high of $22.2 billion, without taking away from other development programs.

“We have increased our support for the Middle East region when it comes to food,” he said citing as one example Lebanon, which has a significant reliance on Ukraine wheat and is facing bread shortages.

He described as a positive step an agreement brokered with Russia and Ukraine last month by the United Nations and Turkey to unblock grain exports from Black Sea ports but said the few shipments so far were not enough to ease the crisis.

Canada was also increasing aid to Egypt, typically the world’s biggest wheat importer, and to Afghanistan, Yemen and Syria that have been riven by conflict.

Canada was also looking at how to help improve resilience in African countries, noting in particular the continent’s shortage of food storage.

— Suleiman Al-Khalidi is Reuters’ chief correspondent for Jordan and Syria.

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Wheat futures finished lower after a choppy session, declining after Egypt’s state grains buyer cancelled an international wheat purchase tender that had attracted offers of U.S. supplies.

Chicago Board of Trade December corn settled down 15-1/2 cents at $5.95-1/4 per bushel, snapping a four-session climb (all figures US$). CBOT November soybeans ended down 22 cents at $13.58-1/4 a bushel and CBOT September wheat finished down 1/2 cent at $8.12-1/4 a bushel.

Corn and soybeans were pressured by a weekly report showing stabilizing U.S. crop conditions. The U.S. Department of Agriculture (USDA) late on Monday rated 64 per cent of the U.S. corn crop in good-to-excellent condition, unchanged from the previous week, while analysts surveyed by Reuters on average had expected a decline of one percentage point.

For soybeans, USDA rated 61 per cent of the crop as good-to-excellent, down from 62 per cent in the previous week, while analysts on average had expected no change.

“A second straight week of steady national corn condition ratings is giving the bears more hope that the current crop can meet or exceed USDA expectations, despite the continuance of a hot and dry summer,” Arlan Suderman, chief commodities economist at StoneX, wrote in a client note.

Forecasts pointed to beneficial rains in portions of the Midwest crop belt for next week, which could bolster yield prospects.

Market pressure also stemmed from hopes that a deal will be found to export more grains out of Ukraine as Russian President Vladimir Putin met with his Turkish counterpart in Iran to discuss the matter.

Still, analysts were cautious about the impact of a deal to resume maritime exports of Ukrainian grain.

“Progress on exports of Ukrainian grain stored at Black Sea ports is not an indication of normalisation in export flows, and we still see profound dislocations in global agricultural trade flows,” JPMorgan analysts said in a note.

— Julie Ingwersen is a Reuters commodities correspondent in Chicago; additional reporting by Naveen Thukral.

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Egypt, often the world’s biggest wheat importer, is reeling from a surge in bread and flour prices after Russia’s invasion of Ukraine closed off access to lower-priced Black Sea wheat.

India, the world’s second biggest wheat producer, has emerged as a leading supplier of the grain to a host of countries that are struggling with cargo disruptions and sky-high grain prices in the wake of the crisis in the Black Sea region.

Although Egypt has been a traditional buyer of Russian and Ukrainian wheat, India is willing to help Cairo by supplying the grain, said the sources, who didn’t wish to be identified in line with official rules.

Egypt could buy up to 12 million tonnes of Indian wheat, they said.

The Egyptian delegation would meet potential Indian buyers, examine logistical and other issues and assess various grades and quality of Indian wheat, the sources said.

“India is in a position to supply top-quality wheat to Egypt and meet Egypt’s quality and other requirements,” said one of the sources.

On Tuesday, Piyush Goyal, India’s minister for commerce and industry, consumer affairs and food and public distribution said he met Hala Elsaid, Egypt’s minister for planning and economic development, in Dubai and discussed New Delhi’s “readiness to supply high-quality wheat” to Cairo.

One of India’s state-run export promotion bodies would assist the Egyptian delegation, the sources said.

On Monday, Egypt’s Prime Minister Moustafa Madbouly said Cairo was counting on France to secure some supplies of basic commodities such as wheat.

Egyptian Supply Minister Ali Moselhy on Thursday said Egypt is in talks with Argentina, India, France and the U.S. for future wheat imports but is in no rush to buy at the moment.

He said Indian suppliers would still have to seek accreditation from state buyer the General Authority for Supply Commodities (GASC).

Earlier this month Egypt set a fixed price for unsubsidized bread to battle a sharp rise in bread prices that jumped 25 per cent to 1.25 Egyptian pounds (6.8 Canadian cents) per loaf in some bakeries.

— Mayank Bhardwaj reports for Reuters from New Delhi.

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