Tareq Hassanein, head of the Federation of Egyptian Industries’ cereals chamber, has announced that new alternatives are being discussed by the chamber to resolve the rice mills issue.
Since the suspension of Egypt's rice exportation, which negatively affected more than 2,000 rice factories on the local market, the chamber is looking at alternatives, such as the desalination of seawater, to boost the industry's flagging profits.
Speaking to Al-Masry Al-Youm on Saturday, Hassanein said the chamber understands the Cabinet's refusal to export rice, as the crops consume large amounts of the Nile water.
Ragab Shehata, head of the rice division at the chamber, said one acre of rice needs 7,000 liters of water. The price of desalination of one liter of seawater costs LE5, an indication of the high cost. However, more technical studies are being pursued to reduce desalination costs and save Nile water.
The decision to suspend the export of rice contributed to a reduction of the product on the local market Shehata said, adding that the price for one ton ranges between LE2,500-LE3,000, compared to LE4,000 before the suspension of exports.
Shehata, however, warned that keeping exports suspended threatens the sector's investments, estimated at LE30 billion, as well as halts work at 50 percent of the companies. He indicated that the total number of companies listed in the industry are estimated at 855, compared to another 1,300 companies that are not officially on record.
Shehata called on Prime Minister Ibrahim Mehleb to instruct the agriculture, irrigation, food supply and industry ministries to look for new alternatives for companies that are at risk of closing.
Meanwhile, Food Supply Minister Khaled Hanafy said the Cabinet’s earlier decision to allow exporting on a conditional basis was exceptional, adding that exports will not be allowed over the coming years to preserve Egypt’s water supply.
The minister also indicated that his ministry, along with the agriculture and irrigation ministries, is considering solutions to prevent the illegal cultivation of rice, adding that cultivated areas should not surpass 1.1 million acres.
Edited translation from Al-Masry Al-Youm
