Hesham Soliman
President of Mediterranean Star for Trading (Egypt)

The war in the Middle East and the disruption surrounding the Strait of Hormuz have added a new layer of instability to regional grain and oilseed markets, with the impact extending far beyond the Gulf itself. What began as a geopolitical and security crisis has quickly evolved into a broader trade, logistics, and cost crisis for import-dependent markets across the Middle East and North Africa. Freight rates, insurance premiums, inland transport charges, payment flows, and commodity prices have all come under simultaneous pressure, while delays in shipping and aviation have deepened uncertainty across the region.

Even where trade routes remain open, the cost of moving goods has increased sharply. In the UAE, for example, land transport fees for loading a container for Saudi Arabia reportedly jumped from AED 2,000 (about $545) to AED 8,000 (about $2,180), while delivery times lengthened because of wartime disruption. North African countries are also feeling the consequences through higher freight, insurance, and commodity costs. 

In Egypt, the economic strain has gone beyond grain logistics alone: Suez Canal revenues have fallen sharply, tourism has weakened, flights have faced repeated delays and cancellations, and airlines and airports have also come under pressure. Grain shipments, meanwhile, have been delayed across multiple origins and destinations. 

EGYPT’S WHEAT MARKET FEELS THE FULL FORCE OF THE CRISIS

For Egypt, the wheat market has been among the clearest expressions of this new stress. Since the conflict began on February 28, local ex-warehouse prices for 12.5% protein wheat have surged from EGP 12,400/mt (around $237/mt) to EGP 14,300/mt (around $273/mt), reaching record highs. At the same time, the Egyptian pound has depreciated by about 9.4%, falling to EGP 52.39 per US dollar on March 13, its weakest level on record. The government’s latest fuel price increase has added further cost pressure by pushing up inland transport expenses, while refined soybean oil prices have also risen sharply from EGP 63,000/mt (around $1,200/mt) to EGP 70,000/mt (around $1,335/mt). The result is a market environment in which inflationary pressure is no longer confined to one commodity, but is spreading across the broader agricultural complex. 

The trade environment has also become more difficult operationally. Some Egyptian importers that rely on banks in Dubai have reported disruptions in banking services, with certain institutions either shutting operations or suspending services, leading to delays in payment processing. For buyers with vessels already at discharge, this has created a serious problem. In some cases, importers have struggled to settle payments for cargoes that have already arrived, turning a price problem into a logistics and financing problem at the same time. This is one of the most dangerous features of the current crisis: even when grain is available, the ability to move money, fix freight, and manage execution has become much more fragile. 

A particularly important shift in Egypt is that imported wheat prices are now broadly matching domestic wheat values, something that does not usually happen. The weaker currency has erased much of the normal advantage of local prices. Since February 28, CIF Egypt bids for 12.5% protein wheat have risen by 2.7% to $263/mt, while freight from Russia to Egypt climbed to $24/mt from $21/mt by March 13. Over the same period, international wheat benchmarks also moved higher. But beyond the nominal increase in flat prices, the more serious concern has been the deterioration in price discovery itself. Black Sea wheat pricing has become harder to read, with Ukrainian exporters reluctant to sell and Russian sellers offering only tentative indications. In such a market, risk management becomes far more complicated than under normal trading conditions.

A MORE COMFORTABLE CORN POSITION, FOR NOW

Corn is facing many of the same pressures, although Egypt’s immediate supply position is more comfortable. The market is well covered into May, which gives buyers some breathing room. Even so, replacement calculations have become increasingly difficult because of volatile freight and Chicago futures. South American corn is trading domestically around $262/mt CIF equivalent, versus roughly $243/mt for Black Sea origin, but neither origin is providing real comfort in a market distorted by currency weakness and logistics risk. Offers from Argentina for April shipment have reportedly been in the high $260s CIF. With a large South American crop approaching the market and liquidity still available in Chicago, Egyptian buyers are not rushing, but they are watching developments closely.

Soybeans are, for now, the least urgent part of the picture in Egypt, with crushers well covered through June. Ukrainian offers are scarce and uncompetitive, leaving US soybeans as the main reference at around $520/mt CIF. The key variable now is the widening spread between US and Brazilian origin, with Brazil reportedly holding a $57/mt advantage. Historically, Brazilian quality has not always matched Egyptian crushers’ preferences, but the current price gap is large enough to force a reassessment, especially under heavy foreign exchange pressure. The market remains comfortable today, but this comfort depends on coverage already in place rather than on confidence in the surrounding trade environment.