ABU DHABI: Egypt's supply ministry said on Monday that it would buy 1 million tonnes of local paddy rice in the next month as a strategic reserve.
The government's failure to stock up earlier this season has left it at the mercy of traders, some of whom have been unwilling to sell their rice to the state in an attempt to push prices up.
The government will start buying up the paddy rice next month when the harvest for the new season begins which will make up a strategic reserve of one year, a ministry statement said.
The statement also said that around 20,000 tonnes of local rice were purchased in the past two days at a price of 4.50 Egyptian pounds ($0.5068) a kilo to provide the grain for the subsidy programme.
Egypt said on Friday it would import 80,000 tonnes of rice through direct contract for arrival within one week to ten days.
Traditionally a rice exporter, Egypt produced 3.75 million tonnes of rice in the 2015 season and held over 700,000 tonnes from 2014 while annual consumption is around 3.3 million tonnes.
The country should have had enough local rice to cover the subsidy programme and have enough surplus for export but a failure to stock up a grain reserve led to shortages in the subsidised rice market as traders stockpiled their rice to push prices upwards.
The attempt to purchase rice from abroad through direct contract comes after the state grain buyer GASC failed in three previous tenders to buy rice off the global market complaining that prices were too high.
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