Egypt cancelled another wheat tender Sunday after extending the application deadline for an extra day.
However, the General Authority for Supply Commodities (GASC) did not indicate the reasons for the cancellation, Bloomberg Business News reported.
Despite the GASC’s request that suppliers extend the validity of their offers until Sunday in an attempt to attract more offers, the authority only received five offers on Friday and four on Saturday.
The new specifications set by the Ministry of Agriculture will continue to drive importers away, Hesham Abou El-Dahab , the chairman of the Grain Industry Chamber within the Federation of Egyptian Industries, told the Daily News Egypt Monday.
“Importers don’t want to apply for a tender and have their shipments stuck in international waters since the agriculture ministry might refuse it again,” Abou El-Dahab said. He called for an agreement between the ministries of supply and agriculture to resolve the issue.
Over the past 10 days, the GASC cancelled two tenders to import wheat. Another tender was issued by the GASC on Thursday and the GASC completed a deal with a Romanian supplier to purchase 60,000 tonnes of wheat.
Egypt faces an impending crisis in its main food commodity after suppliers have boycotted a tender issued earlier this month in protest of new import regulations.
Tension between the GASC and suppliers escalated after the GASC rejected a 63,000 tonne import shipment of wheat from France in January, which contained a 0.05% trace of ergot fungi. Another French wheat shipment was also rejected in December by the Central Administration of Agricultural Quarantine.
The rejection of wheat import shipments has raised concerns over whether EU countries would halt their grain exports to Egypt completely.
Egypt is the world’s top importer of wheat, with some 10m tonnes of imports each year. Along with the domestic production of wheat, this amount is used to provide subsidised bread to the country’s population of over 90 million people.
The quantity of wheat held in Egypt silos is unknown. The government is said to calculate wheat reserves while including shipments that have not yet arrived.
Domestic production of wheat in Egypt is declining due to a reduction in the area of arable land allocated for its cultivation as farmers have turned to more profitable crops, according to a US Department of Agriculture (USDA) report on grains in Egypt.
