Monday,19 November, 2018
Current issue | Issue 1402, (19 - 25 July 2018)
Monday,19 November, 2018
Issue 1402, (19 - 25 July 2018)

Ahram Weekly

Rice imports authorised

Safeya Mounir reports on the implications of the government’s decision to allow rice imports

 

Importing rice instead of growing it will save Egypt 10 billion cubic metres of water                                                                                            photo: Reuters
Importing rice instead of growing it will save Egypt 10 billion cubic metres of water photo: Reuters

Egypt has gone from being a rice exporter to a rice importer. Until a few years ago, it exported rice, but following a recent decision it will now be importing it.

“Rice consumes huge amounts of water to grow, only a little less than sugarcane and bananas. Growing rice for export is thus an additional burden on our water resources,” Ezzeddin Abu Steit, the minister of agriculture and land reclamation, said in explaining the decision.

Reducing the amount of land allocated for rice cultivation would save space to expand wheat and corn production, he said.

Agriculture consumes 85 per cent of Egypt’s water quota from the Nile, estimated at 55 billion cubic metres, and rice cultivation eats up a third of the share allocated for agriculture.

At the same time, Egypt is getting poorer in water. An Egyptian citizen’s share of water stands at 600,000 cubic metres annually, while international standards aim at two million litres per individual per annum, said Saad Nassar, an advisor to the minister of agriculture.

“Importing rice instead of growing it will save Egypt 10 billion cubic metres of water that can help cultivate 500,000 more feddans of corn and increase the area given over to wheat from 3.5 million to four million feddans,” Nassar said. This would also save Egypt some $5 billion in importing animal fodder.

In January, the minister of irrigation and water resources ordered the land allocated for rice cultivation to be reduced from 1.1 million to 700,000 feddans. On 22 April, parliament approved a law increasing the punishment for violations to six months in prison, or a fine ranging from LE3,000 to LE10,000 per feddan. Previously, penalties ranged from LE20 to LE50 per feddan.

The most recent decision to reduce rice cultivation is one of the steps Egypt is taking to rationalise its water consumption after increasing fears that the Grand Ethiopian Renaissance Dam being built on the Nile in Ethiopia will affect Egypt’s share of Nile water.

“Egypt is expected to import 1.5 million tons of rice per year,” said Abdel-Hamid Al-Demerdash, deputy chair of parliament’s Agriculture Committee and chair of the Agricultural Exports Council.

“It will also help to stabilise prices,” he added, explaining that the move would prevent price manipulation.

Chair of the Farmers Syndicate Hussein Abdel-Rahman agreed. “Some merchants had previously been in the habit of buying rice directly from farmers, before the Ministry of Supply announced the price it intended to pay for the crop. Then they would sell it on for higher prices,” he said.

Farmers had also refused to sell rice to the Ministry of Supply because government prices were less than the production cost per ton, he explained.

In May, the Ministry of Supply increased the price it paid for rice from the private sector from LE6,100 to LE6,300 per ton. According to an unnamed ministry official, the increase followed farmers refusing to sell their crop to the ministry, selling it instead to merchants for LE9,000 per ton, Abdel-Rahman said.

When sold on the free market, rice sells for around LE12 per kg, depending on quality.

“Importing rice will help the government to stabilise the price of a kg of rice at between LE7 and LE9,” said Ragab Shehata, head of the Federation of Egyptian Industries Rice Division. It will also prevent merchants from storing it to sell it later at a premium.

Egypt consumes between 3.6 and 3.9 million tons of rice on a yearly basis, and current production stands at five million tons. Until exports of rice were banned, about a million tons of rice were available for export.

The Ministry of Supply buys rice from farmers to make it available to ration cardholders. “The government may use the imported rice for the ration cards because it is cheaper,” said Abdel-Rahman.

However, “Egyptian rice is of better quality and nutritional value in comparison to imported rice,” he said.

add comment

  
 
 
  • follow us on