Tuesday,24 October, 2017
Current issue | Issue 1311, (8 - 21 September 2016)
Tuesday,24 October, 2017
Issue 1311, (8 - 21 September 2016)

Ahram Weekly

Ergot or not ergot

Egypt’s new zero-ergot policy on wheat imports will likely come at a cost, reports Niveen Wahish

Economy
Economy
Al-Ahram Weekly

This has been a year of see-saw decisions as far as Egypt’s wheat imports are concerned.

Even before the year began, the authorities turned away a consignment of French wheat found to contain traces of the ergot fungus, a disease that can affect cereals. But since then the government has changed its policy several times, sometimes saying it will accept a 0.05 per cent ergot level in line with international food standards, and sometimes backtracking and refusing to accept any traces of the fungus for fear of contagion and risks to human health.

More recently, it said it would accept internationally accepted levels of ergot in wheat consignments because it had not received any offers when it called for zero-ergot tenders. But then last week the Ministry of Agriculture performed another volte face, saying it would not accept any imported wheat containing traces of the ergot fungus.

It remains to be seen what the consequences of this decision will be, but last week a wheat tender with the requirement of zero ergot received bids from only one seller, leading to state grain purchaser the General Authority for the Sales of Commodities (GASC) cancelling the tender.

It is believed that this could jeopardise Egypt’s wheat stocks, needed to maintain the country’s vital bread subsidy system. “Wheat stocks are very low and will probably only cover up to the second week of November, including the shipments booked since the last tender,” one Cairo-based trader told Reuters.

According to Nader Noureddin, a professor of soil and water sciences at Cairo University’s Faculty of Agriculture, the decision to allow in wheat containing ergot was only introduced recently by minister of supply Khaled Hanafi, who recently resigned following claims of corruption. Before that, ergot was not allowed to be present in Egyptian wheat imports, and yet the country was never short of tenders.

Egypt is the world’s largest wheat importer. According to the UN Food and Agriculture Organisation’s (FAO) Global Information and Early Warning System (GIEW) wheat imports for the 2016/17 marketing year (running from July to June) are estimated at 11.5 million tons, about the same as the previous year and some one million tons above the average for the last five years.

Noureddin said that the toxins released by the fungus do not go away during the cooking process, and an excessive dose can cause hallucinations, twitches and spasms, cardiovascular troubles, or weaken the immune system. Ergot-infected wheat can also be harmful when consumed by cattle.

Internationally permitted amounts of ergot in wheat were not reassuring, according to Noureddin. In Europe, the average per capita consumption of wheat is 60 kg per annum, but in Egypt it is 182 kilogram.

“There is no telling how the accumulated effect of the permissible levels of ergot in this amount could affect people’s health,” he said. According to the “Winter Wheat Production Manual” produced by the Crop Development Centre at the University of Saskatchewan in Canada, “all grain used for human consumption should be essentially ergot free.”

A zero-tolerance policy was the wisest one as far as ergot levels in wheat were concerned, Noureddin added, as allowing traces of it could open the door to possible infractions of the permitted threshold.

According to Nomaani Nomaani, former head of the GASC, it was regrettable that there had been a lack of clarity on whether traces of the fungus were allowed in wheat slated for import or not.

There needed to be greater coordination between the various authorities in Egypt on whether or not wheat bearing traces of ergot would be allowed, he said. The issue is in the hands of the Ministry of Health, which judges effects on human health, the Ministry of Agriculture, which looks after plant health, and the General Organisation for Export and Import Control.

If there was a ban on the fungus, the quarantine authorities of the exporting countries would need to be informed, Nomaani said. Specifications needed to be clearly stated by the Egyptian Organisation for Standards and Quality, and any decision would need to have clear enforcement dates in order to avoid affecting contracts that had already been concluded, he added.

 Providing the specifications should not be a problem, but it could come at a price and suppliers would need time to adjust, Nomaani said. He was not worried about wheat stocks lasting, at least in the short term, since the wheat harvest had just ended, filling granaries, even though there had been reports that wheat stocks were lower than usual apparently due to corruption issues.

But he said there needed to be clarity to avoid any crisis down the road. Instability in decision-making came at a cost, he said, and traders would likely hike their prices to protect themselves against the risk of exporting wheat to Egypt in moves that would also be negative for Egypt’s reputation.

According to Yaroslav Levitsky, a grain market expert with Proagro, a Ukrainian agriculture consultancy, the decision to ban wheat containing traces of ergot could mean trouble in wheat shipments to Egypt over the next couple of months. When the restrictions were in place before, he said, exporters had found it difficult to make shipments.

Levitsky said there were very few exporters who could provide wheat with zero per cent ergot, which meant that Egypt would likely receive less foreign wheat and tenders would be more subject to cancellation.

“Suppliers offering wheat to the required quality are also likely to charge between $5 and $10 more than they would otherwise,” he said.

The ergot fungus is known to thrive in cool, damp weather conditions and infect cereal grains at the flowering stage.

add comment

  
 
 
  • follow us on