Min. of Supply will build first commodity exchange with Bloomberg factory
Minister of Supply Khalid Hanafi - YOUM7 (Archive)

CAIRO: Minister of Supply and Internal Trade Khaled Hanafy and a high-level delegation visited the Bloomberg international company factory in Texas Wednesday to obtain information about advanced storage technologies in the framework of a three-day tour in the U.S., according to Al-Mal website.

The company is set to implement three major logistic projects in Egypt for the storage of wheat at a cost of 3 billion EGP and 206 million EGP to help improve wheat storage and transfer systems.

The first project is meant to establish a factory specialized in producing storage technology and modern logistics to serve the local market along with exporting to Arab and African countries.

The second project is set to establish ten fruit and vegetable canning factories to prevent spoilage and to reduce production costs.

The third project is meant to renew 164 wheat silos and apply modern storage technology that will reduce the cost of wheat by 30 percent as a result of preventing the wheat wasted strains.

Bloomberg is one of the U.S.’s biggest factories, speacialized in producing new storage technology for wheat and commodity products. The company’s annual sales worldwide totaled nearly $20 billion, according to Al-Mal website.

Hanafi previously announced that he and his accompanying delegation will hold intense talks with the chairman and members of the Chicago commodity Exchange’s Board of Directors to discuss cooperation and technical support for the establishment of Egypt’s first commodity exchanges. The delegation will include representatives from the armed forces, from the Cabinet, and the Arab Contractors Company.

Economist and head of the Egyptian Forum for Economic and Strategic Studies Rashad Abdo heavily criticized Hanafi’s visit to U.S. He said Egypt has been witnessing an information technology revolution that could enable the government to see and identify the achievements of the European and American countries without having to travel there, Abdo said in a Wednesday statement to The Cairo Post.

“We could take advandage of the Chicago Mercantile Exchange for wheat without paying them a visit,” he added.

Egypt has enjoyed international and regional support with it owns several advantages such as its location and history, Abdo said. But Egypt also needs “to build its economy and not to rely on aids. Building factories specialized in producing storage technology and modern logistics is a good step towards reducing price volatility and local commodities exchange.”

On July 3, Egypt had agreed to buy 120,000 tons of Russian wheat and 120,000 tons of Romanian wheat at the price of $262.81 per ton including shipping expenses, Al-Mal newspaper reported. Egypt imported 5.46 million tons of wheat during the 2013-2014 Fiscal Year.

“Egypt is striving to boost self-sufficiency and reduce its 32 billion EGP food import bill,” Hanafi told Al-Masry Al-Youm June 10.

A lot of poor people rely on government subsidized commodities but the public opinion believe it is a wasteful and corrupt distribution system strains by the government. Egypt has taken several steps to boost its storage capacity to reduce its dependence on imports.

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