Reduced Sweet Potato Exports in Egypt Due to Soaring Production Costs

Published 2022년 6월 13일

Sweet potato producers in Egypt are pressured by increasing input costs such as pesticides and fertilizers. To make matters worse, traders have problems with maintaining profitability due to high freight costs. Due to a reduction in sweet potato demand in Europe, prices have also dropped. According to data from Tridge, the wholesale price of sweet potatoes from Egypt was between USD 0.08-0.25/kg, depending on the class. If there is no reduction in the cost of the product, the farmers will turn to more profitable crops, like rice and cotton, thus creating a shortage in the market next season. Although additional investments are needed in the transition from the production of sweet potatoes to the production of cotton, the Egyptian state encourages farmers with a high announced indicative price Also, the high demand from 2021 pushed the farmers to expand the areas under cotton.

The 2021/22 season was difficult for sweet potato growers and traders in Egypt. Input prices have gone up along with transport and handling costs. Ocean-freight prices were around USD 4,000 from Egypt to European ports. To make matters worse, the end of the sweet potato season in March finished with decreased demand and lower quality of sweet potatoes. The lower quality of sweet potatoes was reflected in the price, which according to data from Tridge, was between USD 0.08-0.25/kg, depending on the class. According to 2021 data, Egypt ranked high 3rd in total sweet potato exports with a market share of 7.8% and a value of USD 54.2M. According to Ahmad Shalaby, Senior Engagement Manager at Tridge, the export of sweet potatoes from Egypt for season 2021/22 was around 120,000 mt, 30% less than in the previous season.

Source: Tridge

The main destinations for Egyptian sweet potatoes in 2021 were the United Kingdom and the Netherlands, which accounted for 61.4% of total exports with a total value of USD 29.64M. The United Kingdom recorded a 19.38% drop in YoY in 2021 in the number of sweet potatoes imported from Egypt to 11.53K mt. The Netherlands, on the other hand, increased its quantities by 14.15% YoY, approaching the quantity exported to the UK, at11.45K mt. The reduction in exports also stems from the fact that the harvested area under sweet potatoes is shrinking. Assessments are that for the 2022/23 season, the harvested area under sweet potatoes will reduce by 25-30%. Producers are turning to more profitable crops, such as cotton and rice. Increased transport costs, as well as port congestion, have further strained export dynamics.

In 2021, Egypt produced 275K bales of cotton, increasing by 21.81% YoY. These numbers are still far below 2007 production levels of 950K bales. Nevertheless, areas under cotton are rising. Estimations are that harvested area for cotton is 70,000 ha for CY 2022, an increase of 7.14% YoY. With farmed area for rice increasing to 650,000 ha and production in 2021 at 6M mt, Egypt is the most significant rice producer in Africa.

Sweet potato varieties in demand in Europe, such as Beaugardt, Bellevue, and Evangeline, showed the best production results. However, for Egyptian farmers to continue with successful sweet potato production, the input costs need to be lower. If there is no normalization of the cost of production, farmers will turn to other crops and thus create a shortage in the market next season.