World’s Biggest Wheat Buyer Steps Down From Egypt Authority
Nomani Nomani stepped down as vice chairman of Egypt’s state grain buyer after spending more than three years overseeing tenders for the world’s biggest importer of wheat.
Nomani, 58, said by phone today he will become an adviser to Supply Minister Bassem Oda. Mamdouh Abdel Fattah will succeed him at the General Authority for Supply Commodities, Nomani said.
The authority buys about 5 million metric tons of wheat a year to help provide subsidized bread in a country where 25 percent of the population lived below the poverty line in 2011, according to state figures. Nomani’s decisions on buying grain moved futures markets from Paris to Chicago, Arkady Zlochevsky, president of Russia’s Grain Union, said by telephone on Feb. 6.
“He’s a familiar name,” Shawn McCambridge, a senior grain analyst for Jefferies Bache Commodities LLC in Chicago, said by phone on Feb. 5. “In an unstable region, he’s a stable factor, and that’s what the market likes to see.”
Nomani used more than 30 years of experience and the support of a 12-member team to decide when and how much grain to buy based on available domestic supplies, financing and the outlook for future needs. The authority’s annual purchases account for about half of total national imports estimated by the U.S. Department of Agriculture at 9.5 million tons.
Egypt, struggling to stabilize after the 2011 uprising that ousted President Hosni Mubarak, is facing a budget deficit that may exceed 200 billion Egyptian pounds ($29.7 billion) and is still waiting for a $4.8 billion International Monetary Fund loan. The country relies on tourism, fees for passing along the Suez Canal and overseas investors for foreign currency.
The government’s worsening financial situation will be “the primary restraint” for state wheat purchases, the USDA’s Foreign Agricultural Service unit said in an April 2 report. The $2.5 billion subsidized bread program each year provides 80 billion round loaves at less than one U.S. cent apiece, a daily average of about three per person, the FAS estimates.
Wheat consumption in Egypt surged 39 percent in the past 10 years, outpacing a 32 percent increase in production and leaving the country reliant on imports for half its use, the USDA estimates. The country’s population expanded 18 percent between 2006 and the 2012 census, government figures show.
Egypt is the Arab world’s most populous nation, with almost 87 million people, statistics compiled by Bloomberg show.
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