Commodity markets experienced a substantial downturn in late 2023. With the exception of rice, the prices of the majority of grains and oilseeds have decreased by 15 percent to 20 percent since January 2022. Notwithstanding the deceleration in the global economy, there is anticipation that the demand for agricultural products will attain unprecedented levels in the period of 2023-2024. The December 2023 Food Security Update (FSU) by the World Bank highlights the volatility observed in commodity markets. The FSU reveals that domestic food prices have experienced persistent inflation, with increases exceeding 5 percent in 61.9 percent of low-income countries, 76.1 percent in lower-middle-income countries, 50 percent in upper-middle-income countries, and 57.4 percent in high-income countries. Rising prices are having the greatest impact on countries in Europe, Central Asia, South Asia, North America, and Latin America.
Global Food Security
The World Bank’s December 2023 FSU shows that there is an ongoing global inflationary trend, with agricultural, grain, and export prices increasing by varying rates. Specifically, maize and wheat prices have risen by 8 percent and 14 percent respectively, contributing to an overall increase in the cereal price index. On a year-on-year basis, maize and wheat prices experienced a decline of 28 percent and 25 percent respectively, while rice prices saw an increase of 36 percent and maize prices decreased by 6 percent from January 2021. Overall, the global food price index experienced fluctuations, which resulted in the reduction of some of the previously attained gains.
Figure 1: FAO Food Price Index (points)
Additionally, recent data from the International Food Policy Research Institute shows that sugar prices have increased globally to their highest point since September 2011. This is primarily due to drought-induced production shortfalls in several major exporting nations in South and Southeast Asia. Thailand and India, the two largest exporters of sugar following Brazil, have experienced a decline in sugar production. Due to export limitations and potential bans on sugar exports, sugar production has decreased in both countries, and exports from them are predicted to decline further. Consequently, the rise in demand for biofuels is anticipated to result in elevated sugar prices, as India strives to augment the percentage of ethanol-blended-petrol from 11.5 percent to 20 percent.
In relation to East and Southern Africa, the economies in these regions, which are already fragile, have been impacted, resulting in a significant population experiencing food insecurity. Unfortunately, this situation is anticipated to deteriorate in the coming period. That said, the prices of essential food items in the region have also become stable due to the augmented crop supply during the harvest period. The March 2023 Global Report on Food Crises predicts that approximately 153 million individuals, accounting for roughly 18 percent of the population, will be classified as being at IPC Phase 3 on the food security scale, indicating the presence of a serious food crisis. Approximately 310,000 individuals are projected to be facing catastrophe (IPC Phase 5) across six distinct countries. This phase denotes a critical condition that necessitates immediate intervention to prevent famine. There is also anticipation of an increase in food prices as a result of scarce inventory and persistent economic difficulties in South Africa. The food security interim classifications indicate that Ethiopia, Sudan, South Sudan, and Somalia are at risk of food insecurity, with their populations facing the threat of food insecurity.
Egypt’s Food Security
Food security is a critical global challenge that involves guaranteeing the adequate and high-quality provision of food for the entire population of the country. Food security challenges are a crucial concern in Egypt, given the country’s significant population growth and thriving economy.
The State of Food Security and Nutrition in the World report for 2023, published by the Food and Agriculture Organization of the United Nations, states that between 2004 and 2006, the number of Egyptians suffering from malnutrition—defined as a situation in which an individual’s usual food consumption is insufficient to provide the amount of dietary energy necessary to live a normal and active life—reached about 5 million in 2004–2006, or 6.4 percent of the total population, while the global average was 12 percent. Between 2020 and 2022, the number of malnourished Egyptians increased to approximately 7.8 million, which accounts for 7.2 percent of the population. This rise can be attributed to a substantial population growth of 43.5 percent.
Based on the 2022 Global Food Security Index, Egypt attained a total food security index value of 53 points, placing it in the 77th position globally. Egypt also attained a moderate level of hunger, securing the 57th position out of 121 countries in the Global Hunger Index for 2022.
In order to ensure food and water security, the government has implemented approximately 320 agricultural projects with a total cost exceeding EGP 42 billion. These projects focus on supporting agricultural development and small farmers, promoting sustainable agriculture, combating desertification, and mitigating the impacts of climate change.
As a result of these endeavors, Egypt experienced a 24.6 percent surge in its agricultural crop exports during the export season of the fiscal year 2022-2023. The total value of these exports reached $3.6 billion, compared to $2.9 billion in the previous export season of 2021-2022. Approximately 72,000 tonnes of agricultural crops, valued at $98 million, were exported to countries in the Americas (North and South) and Australia, while 109,000 tonnes, valued at roughly $63 million, were exported to African countries.
The state’s objectives for the ongoing fiscal year include expansion of the designated areas for wheat cultivation to 3.43 million acres, corn to 2.8 million acres, and beans to 220,000 acres. Furthermore, the plan aims to enhance the self-sufficiency rates for wheat and corn to 49 percent, beans to 30 percent, red meat to 70 percent, and fish to 98 percent. Beyond that, it seeks to achieve an export surplus for a wide range of vegetable and fruit crops.
Fisheries play a crucial role in ensuring food security and contribute significantly to a country’s income. Egypt’s enormous lakes help the country become self-sufficient in fish production. Subsequently, the state implemented measures to promote fish farming initiatives, address the food shortage, ensure the availability of premium fish, augment exports, and restrict imports. One of the most significant achievements has been raising Egypt’s annual fish resource production to roughly 2 million tons.
The livestock industry is among the sectors of the Egyptian economy that offer the greatest potential for growth and added value. As a result, the government places significant emphasis on it in order to attain a domestic output of meat and dairy products that satisfies the demands of the domestic market, aids in narrowing the nutritional disparity in a critical animal protein source, and supplies it in suitable quantities, quality, and prices, while also mitigating the trade deficit associated with red meat. During the period from 2014 to 2023, investments in poultry wealth amounted to a volume of EGP 100 billion.
Food security continues to be a critical concern in Egypt, particularly in consideration of the prevailing challenges and worldwide transformations. Despite some progress made in this domain, Egypt is confronted with novel challenges that demand an all-encompassing and unified national approach. There is a need to promote efforts to augment agricultural production and enhance its sustainability, along with advancing natural resource management and cultivating agricultural technology. It is also necessary to increase the export capacity of agricultural products and to broaden their access to international markets. Furthermore, it is crucial to heighten awareness regarding the significance of food security and promote community engagement in its attainment. To further improve food security and encourage investment in agriculture, laws and policies are also required. For Egypt, attaining food security is more than just an objective; it is a cornerstone of the country’s plan for social, economic, and political stability.
