UAE to invest in Egypt sugar complex, bolsters domestic grain supply

A major billion-dollar investment in Egypt’s sugar beet sector could also see corn and wheat production in the country given a boost, representatives of the Middle East sugar refiner Al Khaleej told an industry conference in Dubai, Sunday.

The Al Canal Sugar project will see sugar beet grown on 77,000 hectares in Egypt alongside wheat through the country’s winter and corn in the summer.

Egypt is the world’s biggest importer of wheat, with its own anticipated production of 8.1 million mt in the 2017/18 marketing year augmented by 11.7 million mt of imported wheat, according to the USDA – a level broadly in line with the country’s 2016/17 imports.

Corn imports are expected to be in the region of 8.7 million mt for this marketing year, versus 8.7 million mt in the 2016/17 marketing year.

Demand for wheat and corn is set to decline, as high domestic food prices cut into buyers’ budgets, while the country has already seen its import expectations modified as its capacity to raise capital to fund the purchases remains limited.

“The Egyptian pound’s devaluation (November 3, 2016) doubled the cost of imported corn, slowing imports,” the USDA noted in an Egypt-specific Grain and Feed Update dating from September 2017.

“Imports in the marketing year 2016/17 are revised downwards… due to limited access to foreign currency needed for wheat import purchases,” the report said.

While the complex, which will include a beet-processing factory and a raw sugar cane refinery, will have limited impact on the import balances, it could see Egypt become self-sufficient for sugar.

The investment, from Dubai-based sugar refinery Al Khaleej, would produce 750,000 mt of beet sugar that could rise to 900,000 mt when the complex is complete in February 2021, with the complex to be built on land along the River Nile near Minya, some 150 miles (240 km) south of Cairo.