CAIRO: Egypt, the world’s biggest wheat importer, said on Sunday it would not be affected by Russia’s decision to ban wheat exports because it has adequate stocks and a policy of diversification.
"Egypt has a wheat supply to cover the production of subsidized bread for the upcoming four months," Trade and Industry Minister Rachid Mohamed Rachid said in a statement.
"The recent decision by the Russian government to halt exports will not have an immediate effect on Egypt," he said.
Demand for wheat in Egypt, the Arab world’s most populous country with a population of 80 million, has been rising by around 15 million tons annually, half of which is imported. Egypt is one of Russia’s main clients.
Wheat is heavily subsidized by the government in order to keep affordable bread prices for Egypt’s population, of whom around 40 percent live on less than $2 a day.
Rachid said he recognized people’s concern ahead of the Muslim holy month of Ramadan, when bread consumption rises.
"There will be no impact because projected supplies for all commodities needed during Ramadan have been in stock for more than three months," Rachid said.
As well as available stocks, Rachid said Egypt’s policy of diversification was helping it avoid a shortage. On Sunday, Egypt bought 240,000 tons of wheat from France.
The minister also said that Cairo had decided to suspend wheat imports from Ukraine and Kazakhstan until both countries "finalize their policy on exporting wheat in light of the drought that is impacting the area."
"The changes that are taking place are expected to impact the budget for the fiscal year of 2010-2011 between LE 2.5 billion and LE 4 billion (between $400 and $700 million)," he said.
Russia, the world’s third largest wheat exporter, said it would ban the export of grain from Aug. 15 until Dec. 31 to keep prices down at home amid the worst drought to hit the country in decades.