Egypt’s poultry industry has suffered several successive crises that threaten its continuity. The latest was poultry feed stagnation in ports due to foreign currency crises and the complication of bank letters of credit amid government efforts to contain these crises threatens the entire industry.
The crisis has been building since the outbreak of the Russo-Ukrainian war, affecting most emerging economies, especially Egypt. Dollar liquidity led to a shortage of feed in the market as ports confiscated it and halted imports.
The Central Bank of Egypt (CBE) has also stopped handling collection documents in import operations, instead of using letters of credit for all but 15 basic commodities.
This prevented importers from providing foreign currency, creating a crisis. This decision started to pile up goods in Egyptian ports and its effects began to be reflected in local markets. In particular, it is linked to shortages of some commodities and the tendency of traders to raise prices to record highs across all trade sectors.
Additionally, the canceled pickup documents allowed the importer to remit the value of the goods to the supplier after submitting documents detailing a specific amount and date of pickup. This can be paid in installments.
In a letter of credit, the bank is an intermediary between the importer and the supplier, ensuring that the first party receives goods that meet specifications, and that the supplier pays all commercial transactions to banks before the transaction is completed.
The country’s total number of poultry establishments is about 38,000, including farms, feed factories, slaughterhouses, and outlets selling veterinary medicines and vaccines.
The total volume of commercial poultry production in Egypt officially amounts to about 1.4 billion birds and 13 billion table eggs annually.