Bread prices to remain stable despite inflation, providing relief to Egyptians
Following the Russian conflict, Egyptian food prices rose 4.6% month-on-month in February, and core inflation soared to 7.2% year-on-year from 6.3% in January. Meanwhile, global wheat prices jumped to their highest level since 2012 and despite this, Egypt has set a ceiling on bread prices, relieving its citizens from the burden.
The bulk of the grain imports for several Middle Eastern countries come from Russia and Ukraine, two of the world’s top grain exporters. Russia’s invasion of Ukraine caused some bakeries in Egypt to raise their prices by 25%. For the purpose of limiting the effects of inflation, Egypt fixed the price of non-subsidized bread.
In 2021, Egypt was the world’s largest buyer of wheat, and approximately 80% of its wheat imports came from Russia and Ukraine. Additionally, Egypt has initiated talks with several countries including India to import wheat. Discussions are currently underway for India to start shipping wheat to Egypt.
India is the second largest producer of wheat in the world. In India, the government has given approval to increase rail capacity to cope with an increase in wheat export demand. Additionally, port authorities have been asked to increase the number of terminals and containers dedicated to wheat, according to the Indian Ministry of Commerce and Industry.
An arm of the Commerce Ministry, the Indian Agricultural and Food Export Development Authority, met last week to discuss ways to boost shipments. In the ten months to January 31, wheat exports in India nearly quadrupled to around six million tons. Wheat production in India is expected to reach a record high in 2021-22, up from 109.6 million tons the previous year.