Muhammed Khalid - Ahram
Amidst great scarcity and inflated prices of sugar in many areas across Cairo, Fathy Mohamed, a 31-year-old Egyptian, wanders the capital as he struggles to bring a couple of kilos of sugar back to his family.
"Yesterday saw fierce competition at Hyper Mansoura in Shubra [one of Cairo's oldest and largest neighborhoods] as people vied for only 2 kilos of sugar per person, sold for approximately EGP 30. Upon examining some of the bags, I discovered that the sugar contained impurities, making it unsuitable for human consumption," Mohamed said.
"Later, I visited Panda supermarket in Nasr City but still failed to find any trace of sugar. The staff there said the supply had been sold out upon arrival,” he added. On Tuesday, Egypt’s Minister of Food Supply Ali Moselhi promised to provide more sugar at all outlets, supply chains, and cooperative complexes at EGP 27 per kilo.
The elderly owner of a supermarket in Shubra said the current sugar crisis is unprecedented.
“The distributor suspended the sugar supply for a week, providing neither variety of sugar (there are two varieties of sugar sold for 27 EGP and 55 EGP). I have had sugar that I sold for EGP 27. You should have seen how people fought over it until I was worn down and the entire amount sold,” he narrated with a bitter smile.
The alarming increase in sugar prices in recent weeks has caused widespread concern as vendors and food and beverage companies began stockpiling their inventories.
Ahmed Sheha, a member of the importers' division at the Cairo Chamber of Commerce, told Ahram Online that the current crisis was "triggered by monopolistic practices, and the government must take immediate measures to control the market.”
“Egypt has a sugar supply sufficient for four months, but vendors stock inventories to sell at prices as high as EGP 55 per kilo. However, a kilo of sugar is officially priced at EGP 27 per kilo,” Sheha explained.
Egypt produces around 2.7 million tons of sugar every year through 300,000 feddans of sugar cane and 650,000 feddans of sugar beets, according to data from the Egyptian National Agriculture Library.
The annual local demand stands at 3.5 million.
“Global sugar prices stand at $0.55, which is equivalent to EGP 17 (official market rate). This means that as a commodity that is not subject to customs duty, sugar is priced above its real cost by the government,” Sheha said.
“Even if we apply parallel market rates, sugar prices will not exceed EGP 27. Therefore, the government must criminalize overpricing and mount crackdowns on monopolies. The government can also allow importers to procure sugar from abroad without scrutinizing their US dollar resources,” he added.
According to a report by the United States Department of Agriculture (USDA), Egypt’s total sugar imports are expected to increase by 12 percent year-on-year to 930,000 tons in the fiscal year FY2023/2024.
In 2022, Egypt imported 830,000 tons, 70 percent of which were supplied by Brazil, which is expected to be the country’s main sugar supplier in FY2023/2024, according to the report.
“There is no crisis in the market. The price set by the government is more than reasonable but there is a wave of speculation in the market,” Head of the Sugar Division in the Chamber of Food Industries in the Federation of Industries, Hassan El-Fandi, told Ahram Online.
“The Ministry of Supply and its sugar companies have abundant amounts and hence should increase the supply in the market,” El-Fandi noted. There are five state-owned sugar companies in Egypt operating under the Holding Company for Food Industries (HCFI), which is affiliated with the Ministry of Supply and Internal Trade.
The sugar crisis still awaits a final solution. On Thursday, the Egyptian Ministry of Supply and Internal Trade announced boosting subsidized sugar rations for families due to market shortages.
The ministry said it would add an extra kilo of sugar to the items bought by households of up to three individuals using ration cards. For households of four individuals or more, the ministry will add an extra 2 kilograms.
HCFI will oversee the distribution of 30,000 tons of unsubsidized and approximately 65,000 tons of subsidized sugar across 40,000 outlets. Ahmed Kamal, spokesperson for the Ministry of Supply, stressed that the holding company will provide up to 10,000 tons daily.
Minister Moselhi had previously urged citizens not to buy sugar for more than EGP 27 per kilo, promising that the current crisis would be resolved by mid-December.
