Egypt's food security bolstered by $500 million wheat pact

08 September 20233 min reading

In a landmark development, two prominent Abu Dhabi entities have collaborated in a groundbreaking deal to supply wheat to Egypt, charting a new course for the country's food security. Al Dahra, a global agricultural powerhouse, and the Abu Dhabi Exports Office (ADEX) have joined forces to provide Egypt, the world's largest wheat importer,  with a consistent supply over the next five years.

The strategic collaboration, worth $100 million per annum, will witness Al Dahra and ADEX jointly delivering wheat to Egypt as of this year, setting a strong foundation for a sustained, multi-year endeavor. The partnership echoes Egypt's commitment to fostering enduring relationships with key global producers, aimed at ensuring essential food supplies for its population and reinforcing its food grain supply chain's capacity to endure potential global market fluctuations.

Dr. Ali Al Moselhy, Egypt’s Minister for Supply and Internal Trade, remarked, “The low-cost financing package from ADEX helps us procure high quality wheat at the lowest financing cost available, with comfortable payment terms. This is a successful milestone in our mission to ensure food security to the Egyptian people. All three parties have been working hard over the past few months to bring this to fruition.”

Al Dahra, which already operates over 28,000 hectares of farmland in Egypt, is a key player in the country's agricultural landscape. As the largest private sector producer of wheat and corn in Egypt, Al Dahra has been a vital contributor to Egypt's agricultural tapestry, encompassing crops like onions, sugar beet, sesame, citrus, and sorghum, along with forage for livestock. Its global grains and oilseeds production clocks in at around 600,000 tonnes annually.

Arnoud van den Berg, Group CEO of Al Dahra, stated, “This agreement highlights our commitment to food security in the countries we operate in and complements our efforts from our farms in Egypt. Over the past three years, our farms in Egypt have supplied over 180 thousand tonnes of wheat at the prevailing local market price making us the largest local private sector supplier of Egyptian wheat to the General Authority for Supply Commodities.”

This pioneering partnership augments Egypt's ongoing initiatives to fortify its wheat imports. With recent loans secured from institutions like the International Islamic Trade Finance Corporation (ITFC) and the World Bank, Egypt is proactively working to secure its essential food supplies amidst global dynamics. Egypt suffers from global supply chain interruption and price hikes due to the Russia-Ukraine conflict. The country expects to import 12 million tons of wheat during the 2023-24 season.

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