Egyptian GASC Resumes Wheat Purchases

Egypt’s General Authority for Supply Commodities (GASC) resumed Black Sea wheat purchases, securing 290,000 tons after a three-month gap in tenders while awaiting Russian deliveries. The decision to tender for new supplies helps ensure Egypt’s wheat needs are met despite ongoing shipment delays.

As one of the world’s largest wheat importers, Egypt relies heavily on imports to meet domestic demand. Especially for its subsidized bread program, which feeds millions of citizens. GASC, tasked with securing sufficient wheat supplies, plays a pivotal role in stabilizing food prices and ensuring food security across the country. Delays in shipments from key suppliers like Russia place added pressure on Egypt to diversify its supply base.

Higher Wheat Prices Since Last GASC Tender in August

The average wheat price in the recent GASC tender rose to $257.46/t FOB or $274.82/t C&F, marking an increase of $8.97/t since August. Despite lower freight rates, prices have climbed due to strong demand and logistics challenges. Notably, Ukrainian wheat offered the lowest price at $263/t FOB, which is still $19 higher than August’s minimum price.

Breakdown of GASC Wheat Purchases from Black Sea Region

In this tender, GASC purchased:

• 120,000 tons of Ukrainian wheat from LDC, for December 6-15 delivery, at $275.25/t C&F.
• 120,000 tons of Romanian wheat from Viterra and Olam, for December 6-15 delivery, at $275.30/t C&F.
• 50,000 tons of Bulgarian wheat from Buildcom, scheduled for November 25 to December 5 delivery, at $273/t C&F.

Factors Impacting GASC’s Black Sea Wheat Prices and Supply

The price rise reflects increased demand and constrained global supplies, influenced by geopolitical conditions and fluctuating freight costs. While GASC traditionally sources from the Black Sea region, its recent tender suggests a broader strategy to ensure stable wheat supply amid supply chain uncertainties.

The recent price hike poses challenges for GASC, especially given Egypt’s fixed bread subsidy program, which is essential to Egyptian households. As global wheat prices rise, the government may need to adjust budgets to avoid a subsidy shortfall, or alternatively, consider increasing local production capabilities in the long term

Conclusion:

Facing ongoing delays in wheat shipments from Russia, Egypt’s GASC is adjusting its wheat import strategy, as seen in this latest Black Sea wheat purchase. With supply uncertainties and rising prices, GASC may continue diversifying its procurement to ensure stable and affordable imports from the region.





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