Egypt is Going to Witness a Sugar Rush to Meet 100% Self-Sufficiency

Published 2022년 6월 8일

Refined sugar production is expected to record a YoY increase of roughly 2.5%, driven by rising sugar beet and sugarcane production. The industry is experiencing a sugar rush, which has raised the demand and prices for sugar beets and sugarcane crops in Egypt. In 2021, 80% of the consumption demand is met through domestic production, Egypt relies on Brazil to meet the rest. Currently, the country is looking to achieve 100% self sufficiency in sugar production. Over the last few years, Egypt’s production capacity of sugar has been raised, from 57 percent self-sufficiency in 2017, to 90 percent in 2022. The target for the next few years for Egypt is to reduce its dependency on Brazil for sugar imports.

Egypt is among the fastest growing Arab countries in the world, with a large potential for agri-exports. Refined sugar from sugarcane and sugar beet, in particular, holds positive prospects in the future. For the marketing year (MY) 2022–23, which starts in October 2022 and ends in September 2023, it is expected that Egypt's refined sugar production will rise by about 2.5%. The USDA is projecting that the production is likely to touch 2.92 million mt, out of which 1.64 million mt will come from sugar beets and 1.28 million mt from sugarcane. In terms of consumption and imports, domestic production meets 80% of domestic sugar consumption demand. To meet the remaining demand, the country relies on imports from large producers like Brazil. For MY 2022–23, it is expected that the imports will remain unchanged compared to the previous year, as there has been a steady increase in domestic sugar beet and sugarcane production, which will possibly meet the demand.

A large chunk of Egypt's sugar comes from refining the sugar beet crop in the country. In the last few months, the industrial demand for sugar beets has been rising, which has pushed prices higher and thus incentivised many farmers to plant more beets. Based on USDA forecasts, sugar beet production is expected to reach 11.77 million mt, which is a YoY increase of almost 4%. Similarly, sugarcane production is expected to reach 14.3 million mt, which is a YoY increase of 1%. Improvements in sugarcane production can also be attributed to slightly increased harvested area and improved yields due to continued access to better fertilisers. The majority of these sugar beet and sugarcane crops in Egypt are refined by either of the major 15 sugar processors - eight of which process sugarcane and seven of which process sugar beets.

Egypt produces 80% of its consumption demand and sources the difference between production and demand through imports. In calendar year (CY) 2021, Egypt imported 830,000 MT, with Brazil supplying 92 percent of Egypt’s imports of raw sugar. However, President Abdel Fattah al-Sisi has announced that Egypt’s production capacity of sugar has been raised, from 57 percent self-sufficiency in 2017, to 90 percent in 2022. The country is expected to move to 100% self-sufficiency and reduce its dependence on imports in the coming years. Egypt’s refined sugar production is likely to experience a sugar rush in the upcoming years to ensure that the country does not have to rely on imports to meet the domestic demand.