Egypt’s state grains buyer, the General Authority for Supply Commodities (GASC), has made a significant wheat purchase, buying 770,000 metric tons of mostly Russian wheat in an international tender. This marks GASC’s biggest single purchase since 2022, following a dip in Russian wheat prices.
The purchase comprised 50,000 metric tons of Bulgarian wheat and 720,000 metric tons of Russian wheat. Russian wheat had the lowest price in the tender, as traders believe that Russia’s unofficial minimum export price floor was not implemented.
The price floor had been enforced since last year in an effort to slow Russian wheat exports and cool domestic flour and bread prices. However, two sources have told Reuters that the GASC Vice Chair, Hossam El Garahy, had met with Russian officials last month to urge for a relaxation of the price floor to allow for more price negotiations.
Egypt, often the world’s biggest wheat importer, is usually heavily reliant on competitive Russian wheat imports. The North African country had been grappling with a shortage of foreign currency over the last two years, but recently secured a windfall of funding since late February from the IMF, the UAE, and other entities.
GASC had recently been buying wheat from cheaper origins over the past couple of months. One trader commented that “the relaxation of the price floor enabled negotiations we have not seen in an Egyptian tender for a long time.”
This large wheat purchase by Egypt, its biggest since 2022, suggests that the country’s financial situation has improved, and it is now able to take advantage of the lower Russian wheat prices to secure its supply.