Egypt is implementing strategies to reduce wheat imports and lower government spending on subsidized bread by adding corn or sorghum to the flour mix, according to industry sources. This initiative aims to save millions of dollars but faces backlash from bakers and millers concerned about potential declines in bread quality.
The government has been struggling with rising debt, foreign currency shortages, and persistent inflation. The bread subsidy program, which the government intends to eventually phase out, is a significant budget strain.
Under the new plan, corn flour will be blended with wheat flour at a 1:4 ratio starting in April 2025, potentially saving around one million metric tons of wheat. However, the government scrapped an earlier proposal to increase the flour extraction rate for subsidized bread due to opposition from industry stakeholders.
Historically, Egypt has floated wheat substitution schemes to achieve greater self-sufficiency, with corn previously used in bread production before being abandoned under pressure from industry groups.
Utilizing locally grown corn could lead to substantial hard currency savings, especially since corn is currently priced lower than Russian wheat. However, the change may alter the texture and smell of the bread, causing discontent among consumers.
Egypt requires about 8.25 million tons of wheat annually for subsidized bread, sourcing approximately 3.5 million tons locally and importing the remainder. The state commodity buyer, GASC, reported a commitment to maintaining specifications and extraction rates for wheat flour.
In August, President Abdel Fattah al-Sisi ordered the largest wheat tender ever, but the state grains buyer acquired only 7% of the targeted amount. The government is also exploring alternatives like bank loans for wheat purchases and direct deals with traders.
Additionally, proposals to use cheaper sorghum flour have been discussed, although bakers oppose this due to increased baking times and labor costs.