Agriculture Minister Adel El-Beltagy will meet with the Textile Industries Chamber and the Holding Company for Spinning and Weaving Thursday to discuss the textile industry’s development, a Chamber official said.
The official said that the Chamber will discuss the government’s decision not to provide subsidies for cotton crops next season with the Minister.
El-Beltagy said in a press statement that the government will not subsidise cotton crops next season.
Government subsidies for cotton crops reached approximately EGP 520m last season, according to Ministry of Finance data.
“We were not invited to meet the minister Thursday,” said the head of the Farmers Syndicate Farid Wasel. He added that the syndicate will send a memorandum to the president following his return from the Gulf regarding the damages incurred by farmers due to the elimination of cotton crop subsidies.
Dr Ahmed Mustafa, head of the Holding Company for Spinning and Weaving, believes the decision to lift subsidies for cotton comes in the framework of organising relations between the buyer and the farmer. He added that this was especially in light of an increase in the area taken up by cotton production over the past year, exceeding 340,000 acres and representing 20% growth over last season.
Local cotton prices exceed EGP 1,400, while imported short-staple cotton price are worth less than EGP 800, resulting in more demand on the latter, according to the Chairman of Cotton & Textile Industries Holding Company.
An official with the Egyptian Chamber of Textile Industries said the rate of low quality imported cotton ranges between 10% and 15%, but for Egyptian middle-staple and long-staple cotton, the same figure is only 2%.
Wasel announced that the land area of cultivated cotton last season barely reached 200,000 acres and that the government did not carry out a good marketing plan.
He added that the lack of development in the business sector companies and inconsistency in Agriculture Minister regulations are the reason behind the stagnation of the cotton industry in Egypt.
Wasel said that the latest regulation will result in a decline in land areas cultivated for cotton in Egypt by more than 80%.
Local companies consume roughly 1.3bn quintals of the local cotton production and the rest is exported, said the Chamber official.
