Egypt’s planned wheat price hike sparks backlash from farmers

Egyptian farmers pushed back against a planned 150-pound hike in state wheat procurement prices for the upcoming season, calling the adjustment woefully inadequate against runaway production costs and demanding at least 3,000 Egyptian pounds ($53) per ardeb (around 150 kg) to avert a planting retreat.

The government announced days ago that it targets lifting local procurement prices for strategic crops in the coming agricultural season from 2,500–2,650 pounds per ardeb. Authorities also raised the target procurement price for a metric ton of sugar beets to 2,300 pounds from a previous 2,000 pounds, official disclosures show.

The official price fails to offset the mounting costs of fertilizers, diesel, electricity, and manual labor, said Ahmed Osama, a farmer in Luxor. He told Al Manassa that depressed procurement prices relative to market costs for wheat bran and animal feed are already pushing livestock breeders to divert harvest yields away from human consumption and into animal troughs.

Emad Hussein, former head of the Farmers Syndicate, backed those concerns, telling Al Manassa that expenses across agricultural inputs doubled compared to last year, squeezing smallholders and eviscerating projected returns on wheat cultivation.

Authorities raised diesel prices by roughly 17.4% in March as part of sweeping fuel adjustments driven by global energy pressures. The government denied instituting fresh fuel price hikes this month, despite forecasts of rising energy outlays amid the ongoing US-Iranian war.

Farmer demands strike at an acute vulnerability for state planners, who are scrambling to bolster domestic grain reserves as the Russia–Ukraine conflict keeps global markets volatile, heightening pressure on the state to secure local stockpiles and curb reliance on imports.

When translated into foreign currency, the state’s proposed procurement rate actually erodes farmer compensation, said Hesham Soliman, managing director of Mediterranean Trading Company.

Soliman told Al Manassa that last season’s procurement rate of 16,500 pounds per metric ton stood at roughly $320 based on an exchange rate of 47 pounds to the dollar.

In contrast, the upcoming season’s target price works out to approximately $315 per ton against an exchange rate of 55.5 pounds to the dollar.

The dollar surged further this month as foreign investors pulled capital out of local debt instruments amid escalating Middle East conflict, clearing 56 pounds in trading on Monday.

The international wheat benchmark sits near $325 per metric ton, leaving Cairo’s domestic procurement target well below import parity, Soliman said. He argued that an equitable purchase price must touch 3,000 pounds per ardeb to preserve decent farm incomes and encourage growers to expand planted acreage.

The announced 150-pound increment does not even cover the seasonal jump in agricultural labor wages, said Mohamed Farag, head of the Farmers Union.

Addressing chronic chemical shortages, Farag told Al Manassa that subsidized fertilizer bags fetch around 1,200 pounds on the free market, while private merchants charge between 1,400 and 1,700 pounds. 

Farag pointed out a stark rift between official statements touting fertilizer availability and the harsh realities growers face when attempting to secure allocations.

Calls persist across the industry to add at least another 100 pounds per ardeb to the procurement baseline, Abdel Ghaffar El-Salamony, deputy head of the Cereals Industry Chamber at the Federation of Egyptian Industries, told Al Manassa. 

El-Salamony projected the price could reach roughly 2,750 pounds during the forthcoming harvest season to reflect potential price hikes.