Latest news with #MostakbalMisr
Zawya
2 days ago
- Business
- Zawya
Egypt's new grains buyer struck rare deal for French wheat, sources say
DUBAI - Egypt's state grains buyer Mostakbal Misr agreed in April to buy around 180,000 metric tons of French wheat from two top European traders, trading sources said, in a sign of growing acceptance of the new entity by global suppliers. Mostakbal Misr bought two 60,000 metric ton cargoes from one firm and another similarly sized cargo from another, two trading sources with knowledge of the matter told Reuters, though they said delivery of the cargoes was facing delays. The private agreement, which has not been previously reported, is one of the few instances Mostakbal Misr has been able to secure cargoes for Egypt's massive bread subsidy programme directly from global suppliers. Those suppliers have been hesitant to deal with the little-known military agency, traders say. Egypt is one of the world's top wheat importers, buying about five million tons from abroad on average. For decades, the General Authority for Supply Commodities (GASC), a civilian agency that is part of the supply ministry, imported wheat and vegetable oils through international tenders. Since Mostakbal Misr took over the import of major commodities in December, it has relied on local importers to act as intermediaries on purchases. Its lack of experience dealing with global commodity traders contributed to early teething problems, said one of the sources. "Global traders were asking for a commercial registry or a tax card so that risk departments would approve any deals with them but that was not provided," the source said. "That's why local importers came in as intermediaries." If the deals can be successfully concluded it would mark a breakthrough for Mostakbal Misr, but the sources, both of whom spoke on condition of anonymity because of the sensitivity of the matter, said there had been delays in opening letters of credit to pay for the shipments, as well as in assigning freight to transport them. Traders said at least some of the volume was expected to be loaded in May, and the rest in June. The second source said the two cargoes were sold at a price of $246 per ton for immediate, "at sight" payment, while the third cargo was sold for $256 per ton with deferred payment via 180-day letters of credit. Egypt's supply ministry and Mostakbal Misr did not respond to requests for comment. Suppliers went ahead with the deal as a result of weak global demand, especially for French wheat which has been impacted by a spat with Algeria, the first source said. The deal coincided with a visit by French President Emmanuel Macron to Egypt in April. Reuters could not determine if the deal was connected to the visit. The sales to Egypt could be a boost for French wheat exports after a dire spell marked by a poor harvest and diplomatic tensions with Algeria, though the absence of any loadings in May has created uncertainty in the market over the deals. France exports wheat only occasionally to Egypt, with its previous shipments dating back to July last year. The European Union's biggest wheat producer generally struggles to compete against Black Sea suppliers like Russia and Romania that dominate the Egyptian import market. But traders say a drop in French prices this year coupled with increased Black Sea prices created an opportunity. Bulgarian wheat that Mostakbal Misr bought directly in a similar deal earlier this year was successfully shipped. "This time is more serious than others. They are dealing with big international suppliers directly," said the second source. "We are waiting to see how this deal is going to be executed." Mostakbal Misr is currently holding talks for the purchase of Bulgarian and Romanian wheat.
Reuters
2 days ago
- Business
- Reuters
Exclusive: Egypt's new grains buyer struck rare deal for French wheat, sources say
DUBAI, June 2 (Reuters) - Egypt's state grains buyer Mostakbal Misr agreed in April to buy around 180,000 metric tons of French wheat from two top European traders, trading sources said, in a sign of growing acceptance of the new entity by global suppliers. Mostakbal Misr bought two 60,000 metric ton cargoes from one firm and another similarly sized cargo from another, two trading sources with knowledge of the matter told Reuters, though they said delivery of the cargoes was facing delays. The private agreement, which has not been previously reported, is one of the few instances Mostakbal Misr has been able to secure cargoes for Egypt's massive bread subsidy programme directly from global suppliers. Those suppliers have been hesitant to deal with the little-known military agency, traders say. Egypt is one of the world's top wheat importers, buying about five million tons from abroad on average. For decades, the General Authority for Supply Commodities (GASC), a civilian agency that is part of the supply ministry, imported wheat and vegetable oils through international tenders. Since Mostakbal Misr took over the import of major commodities in December, it has relied on local importers to act as intermediaries on purchases. Its lack of experience dealing with global commodity traders contributed to early teething problems, said one of the sources. "Global traders were asking for a commercial registry or a tax card so that risk departments would approve any deals with them but that was not provided," the source said. "That's why local importers came in as intermediaries." If the deals can be successfully concluded it would mark a breakthrough for Mostakbal Misr, but the sources, both of whom spoke on condition of anonymity because of the sensitivity of the matter, said there had been delays in opening letters of credit to pay for the shipments, as well as in assigning freight to transport them. Traders said at least some of the volume was expected to be loaded in May, and the rest in June. The second source said the two cargoes were sold at a price of $246 per ton for immediate, "at sight" payment, while the third cargo was sold for $256 per ton with deferred payment via 180-day letters of credit. Egypt's supply ministry and Mostakbal Misr did not respond to requests for comment. Suppliers went ahead with the deal as a result of weak global demand, especially for French wheat which has been impacted by a spat with Algeria, the first source said. The deal coincided with a visit by French President Emmanuel Macron to Egypt in April. Reuters could not determine if the deal was connected to the visit. The sales to Egypt could be a boost for French wheat exports after a dire spell marked by a poor harvest and diplomatic tensions with Algeria, though the absence of any loadings in May has created uncertainty in the market over the deals. France exports wheat only occasionally to Egypt, with its previous shipments dating back to July last year. The European Union's biggest wheat producer generally struggles to compete against Black Sea suppliers like Russia and Romania that dominate the Egyptian import market. But traders say a drop in French prices this year coupled with increased Black Sea prices created an opportunity. Bulgarian wheat that Mostakbal Misr bought directly in a similar deal earlier this year was successfully shipped. "This time is more serious than others. They are dealing with big international suppliers directly," said the second source. "We are waiting to see how this deal is going to be executed." Mostakbal Misr is currently holding talks for the purchase of Bulgarian and Romanian wheat.
Asharq Al-Awsat
3 days ago
- Business
- Asharq Al-Awsat
Egypt Plans Desert City Supplied with Diverted Nile Water
Egypt unveiled plans on Sunday to build a desert city that will see about 7% of Egypt's annual Nile River quota rerouted from fertile delta land to pass by upscale glass-fronted housing units and eventually a large agricultural project. Egypt, facing mounting water shortages, power constraints, and a deepening economic crisis, wants the development to help increase the value of state assets and boost land prices through "non-traditional, innovative ideas," Prime Minister Mostafa Madbouly said in a statement announcing the project. About 10 million cubic metres of Nile water will flow daily to the 6.8 million sq metre (2.63 sq mile) Jirian city, 42 km (26 miles) west of downtown Cairo, helping irrigate a 2.28 million acre New Delta agricultural project, developers said. Three private developers signed the official agreement, with the state represented by Mostakbal Misr for Sustainable Development, a military-affiliated agency. The project will include residential units, commercial zones, a yacht marina and a free economic zone.
Reuters
3 days ago
- Business
- Reuters
Egypt plans desert city supplied with diverted Nile water
CAIRO, June 1 (Reuters) - Egypt unveiled plans on Sunday to build a desert city that will see about 7% of Egypt's annual Nile River quota rerouted from fertile delta land to pass by upscale glass-fronted housing units and eventually a large agricultural project. Egypt, facing mounting water shortages, power constraints, and a deepening economic crisis, wants the development to help increase the value of state assets and boost land prices through "non-traditional, innovative ideas," Prime Minister Mostafa Madbouly said in a statement announcing the project. About 10 million cubic metres of Nile water will flow daily to the 6.8 million sq metre (2.63 sq mile) Jirian city, 42 km (26 miles) west of downtown Cairo, helping irrigate a 2.28 million acre New Delta agricultural project, developers said. Three private developers signed the official agreement, with the state represented by Mostakbal Misr for Sustainable Development, a military-affiliated agency. The project will include residential units, commercial zones, a yacht marina and a free economic zone.
Zawya
07-03-2025
- Business
- Zawya
Egypt's new military-run grain buyer pushing up local prices, traders say
CAIRO: Egypt's decision to shift its wheat import programme to a military-affiliated entity around four months ago has been anything but smooth as local prices climb and stock levels fall, traders in the country said. Egypt, one of the world's largest wheat importers, previously relied on the General Authority for Supply Commodities (GASC) to conduct large-scale international tenders, securing supplies with long-standing financing agreements. However, in December, the government transferred this role to Mostakbal Misr, an entity that until that moment was only known to be the development arm of the Egyptian Air Force. It has not said why the change was made. The success of its wheat import programme is absolutely critical for Egypt which distributes subsidised bread to tens of millions of its people providing a lifeline in a country facing a cost-of-living crisis with record-high inflation. Traders said the switch has transformed Egypt from one of the most transparent wheat buyers to a much more secretive one. Instead of buying wheat directly from global markets in publicly announced tenders, Mostakbal Misr has largely sourced it from local Egyptian importers, who primarily procure from Russia, traders said. According to three traders, Russian suppliers have been hesitant to engage with Mostakbal Misr, citing its lack of experience in commodity trading. Instead, one trader said that global and Russian suppliers prefer to engage with experienced Egyptian importers rather than military organisations with no history in the trade. This shift has contributed to a 10% rise in domestic wheat prices, as Mostakbal Misr's purchasing model has increased demand in the local market, traders said. According to two traders, representatives of Mostakbal Misr are present at ports and agricultural offices to oversee incoming shipments, with negotiations taking place at Mostakbal Misr's headquarters to take part or all of the cargo. Despite buying from the local market and paying local suppliers in Egyptian pounds, two traders told Reuters that Mostakbal Misr charged the state in U.S. dollars and still relies on GASC to manage financing arrangements, adding another layer of complexity. The Egyptian Supply Ministry did not immediately respond to a request for comment. Meanwhile, wheat reserves have declined and now cover just five months of consumption, which includes future deliveries, down from seven months in mid-2024. Since taking over, Mostakbal Misr has signed contracts for 2.7 million metric tons with Egyptian suppliers, including 1.7 million tons for February and March delivery, one trader with knowledge of the matter said. Around 850,000 tonnes have been delivered so far, he noted. He said around 1.7 million tons were bought using 270-day letters of credit, while 900,000 to one million tons were purchased with funding from the International Islamic Trade Finance Corporation (ITFC), which lends Egypt hard currency to secure grain purchases. In both cases, Mostakbal Misr still had to rely on GASC to manage the purchases, he added, noting that financial backers, such as the ITFC and the European Commission have not yet embraced the change in purchasing agency. Both the ITFC and the European Commission recently signed agreements to support Egypt's grain imports through GASC and not Mostakbal Misr. A trader questioned the current financial processes, asking why GASC is receiving funds from foreign lenders if Mostakbal Misr is handling grain imports exclusively. (Reporting by Mohamed Ezz; editing by David Evans)
