Jenaan changes Egypt strategy to wheat for local market

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Reuters | 25 November 2013
Abu Dhabi-based agriculture investment firm Jenaan, which acquired 160,000 feddans of land in Egypt, said it was changing its strategy in Egypt to growing wheat and helping ensure food supplies for the domestic market, instead of forage for export. "The Abu Dhabi government has advised us that we have to be part of Egypt's food security, and that is why we have already started growing wheat there now," Jenaan Chairman Mohammad al Otaiba told Reuters. (Photo: Shawn Baldwin/Getty Images)

Jenaan changes Egypt strategy to wheat for local market

By Maha El Dahan

ABU DHABI, Nov 25 (Reuters) - Abu Dhabi-based agriculture investment firm Jenaan said it was changing its strategy in Egypt to growing wheat and helping ensure food supplies for the domestic market, instead of forage for export.

Jenaan, which has agricultural investments from Spain to Ethiopia, said it changed its policy in part because it had been losing money in Egypt and in part due to advice from the government of Abu Dhabi.

"The Abu Dhabi government has advised us that we have to be part of Egypt's food security, and that is why we have already started growing wheat there now," Jenaan Chairman Mohammad al Otaiba told Reuters.

Jenaan has acquired 160,000 feddans of land in East Oweinat, in Egypt's south and in Minya governorate since 2007. A feddan is the equivalent of 0.42 hectare.

Jenaan was producing forage to feed livestock in Abu Dhabi but was losing money, partly due to an export tax of 300 Egyptian pounds ($43.56) a tonne on the crops it exported back to Abu Dhabi.

"We were incurring loss after loss," Otaiba said.

"We consider Egypt to be like our own country. We are brothers, but we were taxed and that ate up our profits so we had losses," he said.

Otaiba also mentioned problems in Egypt with obtaining supplies of diesel to fuel its machinery, which slowed farm operations.

"After the revolution matters became even worse. There were a lot of strikes and it was hard to get labour," he said, referring to the uprising that toppled former Egyptian president Hosni Mubarak in February 2011.

"Now the situation is much more stable, but we have decided to sell all our production locally inside Egypt, and that way we will avoid the export tax," Otaiba said.

Jenaan has started cultivating 10,000 feddans of wheat in Egypt's East Oweinat already and is looking to plant 30,000 feddans more next year.

Egypt, the world's largest wheat importer, is expected to produce around 8.1 million to 8.3 million tonnes in the 2014-2015 harvest season.

The North African country buys around 10 million tonnes of wheat a year from abroad through the state buying agency and private buyers. The government sells subsidised saucer-sized flat loaves of bread for less than 1 U.S. cent to millions of Egyptians.

Jenaan, which was founded in 2005, works closely with the Abu Dhabi government to ensure food security for the United Arab Emirates, which imports more than 90 percent of its food.

The company has agricultural investments in the United States, Spain, Sudan, Ethiopia and Egypt mainly for the production of forage for livestock but also for wheat, rice and corn. ($1 = 6.8877 Egyptian pounds) (Reporting by Maha El Dahan; editing by Louise Heavens and Jane Baird)
Original source: Reuters
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1 Comments


  1. Vance Hodgson
    27 Dec 2013

    Farming in the desert has many challenges especially controlling temperature extremes and humidity levels through irrigation, these are not possible with centre pivot or even drip irrigation. In South Africa we have the Ferrari of irrigation systems which is called Floppy Sprinklers which irrigates whole fields at a time with very low application rates so no water is wasted. This does not sound like much but compared to the outside of centre pivot where application rates increase the bigger the pivot becomes you find that irrigation application rates can increase to as high as 50mm of water being applied to ground which may not have the infiltration rate capability to absorb these huge amounts of water resulting in water runoff leading to another host of challenges, erosion, water and nutrient loss and poor yields. Salt buildup also occurs due to not being able to flush soil profiles due to poor water infiltration and leaching of excess salts. I hope I have tweaked someone's attention and look forward to answering any further questions. Vance

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