Supported by rich natural conditions along the Nile, which are able to host a variety of valuable crops, agriculture has long been a critical sector for Egypt’s economy. Output comprises fruits, vegetables, cereals, cotton, and sugar, as well as livestock, and is a critical element for both domestic consumption and exports. However, production is threatened by growing pressures, including a fast-growing population and the effects of climate change, both of which are leading to water shortages.

Urban Challenges

Another issue is that high rates of urbanisation have reduced the amount of arable land available – a problem that was compounded in the years following the 2011 revolution. For example, due to insufficient controls, Egypt witnessed a substantial spike in informal building, much of which expanded into land traditionally used for farming. Government data points to as many as 80,000 ha being lost since 2011, but other estimates put that number as high as 150,000 ha.

Aside from the direct impact of urban development on the diminishing of agricultural space, the problem also affects surrounding agricultural lands, which have seen their access to water reduced due to the rise of more densely populated areas nearby. With most Egyptian cities continuing to expand, protecting agricultural land will be critical for the sector’s long-term development.

Economic Contribution

Despite the challenges, agricultural output remains a healthy component of the national economy. The sector’s contribution to GDP averaged 13.2% between 2000 and 2017, according to the International Food Policy Research Institute (IFPRI). World Bank figures for the same period put the sector’s share of total employment at 29%. These numbers represent a reduction in the sector’s overall contribution to the Egyptian economy, which accounted for 29% of GDP in 1970, according to the IFPRI, and roughly 50% of national employment in the 1970s. Despite these decreases, which have been influenced by growth in other areas of the economy, agriculture still plays an important role, particularly in rural communities.

Moreover, the authorities have consistently underlined the sector’s role in reducing food imports and enhancing self-sufficiency, which remain key policy goals. These targets have become particularly pertinent in the current economic circumstances, whereby the currency devaluation implemented in 2016 has made imports much more expensive.

Overisght & Strategy

Government bodies and other institutions have a key role in sector oversight. Chief among them is the Ministry of Agriculture and Land Reclamation (MALR), charged with handling agricultural policy implementation and increasing the amount of arable land in the country through land reclamation programmes. The MALR is also involved with promoting agricultural productivity, yield improvement and growing exports of the country’s agricultural goods to international markets.

Another important sector player is the Ministry of Irrigation and Water Resources (MIWR), which is in charge of adequately allocating water resources. An estimated 80% of Egypt’s water is used by the agriculture sector, with the majority of it coming from the Nile, although certain areas have access to ancient underground aquifers.

Besides managing water resources and land allocation, the government has a direct impact on the sector through its annual determination of both controlled procurement prices and indicative prices for crops. These influence farmers’ decisions about which crops to focus on producing from year to year.

Sector policy is shaped by the Sustainable Agricultural Development Strategy 2030, which was originally formulated in 2009. The strategy focuses on the use of technological improvements to increase agricultural production and sector growth, the efficient use of water resources, and support for land reclamation projects to increase arable land and establish new communities. “Efficient food production is necessary to meet the demands of a growing population,” Ali Nenai, commercial area manager of agricultural chemical company Nufarm, told OBG. “Modern farming techniques and irrigation methods are a part of this equation, as is the effective use of fertilisers,” he added.

The MALR and the UN’s Food and Agriculture Organisation (FAO) signed a technical cooperation protocol to update the Sustainable Agricultural Development Strategy 2030 in February 2019. This will be funded through the FAO Technical Cooperation Programme (TCP) and comprise the preparation of a medium and short-term plan of action, as well as “mechanisms for implementation, monitoring and evaluation”. To this end, the TCP will also involve workshops and training courses.


Despite the government’s goals for the sector, recent years have brought several new challenges and compounded structural shortcomings. Land occupation undertaken in the years following 2011 meant some agricultural enterprises had to hire security, increasing costs and taking the focus away from improving production techniques.

Although security has seen an overall improvement, production costs were also affected by the removal of energy subsidies, which led to cost increases of roughly 15%. The price of labour and fertilisers have also increased, although this was partly offset by the ability of some farmers to increase their prices in the domestic market.

The sector also remains split between smallscale farmers with artisanal growing methods, and large-scale production using modern techniques and consolidated expanses of land. Bridging these two sides of the industry will require better integration. Contract farming – either through largescale firms integrating smaller-scale farmers, or smaller-scale producers coordinating with specific traders – already accounts for about 40% of the sector. Expanding this format will likely help Egypt increase production in a sustainable manner and expand its presence in international markets.


Bolstering sector exports is one of the main priorities for both public actors and private operators. According to figures from the Agricultural Export Council, the value of sector exports rose by 3% in 2017, reaching $2.2bn. Key exports include potatoes, cotton, and fresh fruit, and although authorities have been attempting to diversify export markets, the agricultural sector depends heavily on a small number of countries with high import requirements. In 2017, for instance, the value of exports to Russia hit $290m, followed by Saudi Arabia at $286.7m, and the Netherlands at $143.4m, according to local media reports. Agricultural exports to the US, another key market, increased by 10% in 2017, reaching $127m. The Egyptian pound’s flotation in late 2016, which resulted in a significant drop in the currency’s value, also made its fruits and vegetable exports more attractive to international buyers.

Also in 2016, exports were temporarily affected by a Russian ban on Egyptian agricultural products, due to a dispute between the two countries over sanitary requirements. Since then, however, Egyptian exporters have been able to increase the flow of agricultural and agro-industrial products into international markets. Over the first nine months of 2017, the volume of agricultural exports increased by 13.9% to 4.1m tonnes; a considerable improvement on 2016 year-end figures, which had settled at 3.6m tonnes, according to international media. “In the agriculture business, timing is the key issue because with products traded globally, price is determined by availability,” Aly El Gamil, CEO of Cairo Three A, told OBG. “Egypt has a lot of opportunity for growth and investment in agriculture because it has a climate and geography that allows it to take advantage of the timing factor in global agriculture trade.”

Although Egypt’s main agricultural export markets remain the EU, Russia and nations of the Gulf Cooperation Council, the government and the private sector have been attempting to reach new markets, namely India, China, and South-east Asian nations.

In 2018 Egyptian sanitary authorities and the Agricultural Export Council met with their Chinese counterparts in order to open the gate for more exports to the world’s most populous country. Similar bilateral discussions have already led to the export of Egyptian garlic to Indonesia, while officials have also attended talks with counterparts in Hong Kong, Singapore, Malaysia and Thailand to promote quality compliance of Egyptian products.

One trend that could boost the sector’s revenue potential is an increase in the proportion of processed agricultural goods as a percentage of total agricultural exports. This rose from 46% in 2002 to 53% in 2014, according to the IFPRI. A large proportion of these exports are accounted for by semi-processed products, such as frozen vegetables.


Egyptian cotton has been staging a comeback in international markets after years of economic instability and low quality affected its standing abroad. “The amount of cotton production has decreased significantly since the height of the industry, and the quality is no longer what it once was,” Fadel Marzouk, CEO of local textile company Giza Spinning, told OBG. “However, a concerted effort from both the government and the private sector is under way to boost both quality and quantity and support industry growth.”


The climatic conditions in Egypt make it well suited for the production of long-staple cotton, which is used to make high-quality clothing and linen. In 2017 Egypt was the world’s second largest producer of long-staple cotton after the US. In mid-2018 the government estimated that Egypt would export 52,000 tonnes of long-staple cotton during the 2017/18 season.

Production and exports are also flourishing on the back of better quality control. In 2017 the Egyptian government took a more active role in determining cotton seed quality and ensuring its distribution to farmers. An increase in the indicative price for cotton, determined by the government, is also expected to encourage farmers to continue to increase cotton growing areas over the coming seasons. According to the US Department of Agriculture (USDA), cotton farmers in the Nile Delta Region were able to sell their 2017/18 production at LE3200 ($180) per kantar (the official Egyptian weight unit for measuring cotton – equivalent to 45.02 kg), an 18.5% increase on the previous season’s prices.

The decrease in the value of the Egyptian pound, in hand with the expected increase of cotton producing areas driven by better indicative prices, is expected to help lead the cotton segment forward. In addition to the current market dynamics, efforts to improve and protect the quality and international prestige of the country’s cotton output are under way. In 2005 the Alexandria Cotton Exporters Association, which has the rights to the Egyptian Cotton logo, partnered with the Ministry of Trade and Industry to set up the Cotton Egypt Association (CEA), tasked with licensing the use of the Egyptian Cotton logo to accredited companies.

Through regular DNA testing of cotton samples across the sector’s supply chain, CEA is focusing on reducing fraudulent claims by producers that claim to be using Egyptian cotton exclusively but mix it with cheaper quality cotton sourced from other countries. “In 2015 there was a huge issue with products that claimed to be Egyptian cotton but were mixed with other lower quality material. Up to 90% of clothing that claimed to be made with 100% Egyptian cotton was in fact mixed with lower quality cotton,” Khaled Schuman, executive director of the CEA, told OBG. “However, the situation has vastly improved. It is only by protecting our brand of cotton that we can make the industry more profitable for everyone involved in the value chain.”


Citrus fruits remain a large component of agricultural sales, both to domestic and overseas buyers. Orange production in particular has a solid footing across most of the Nile Valley and Delta regions, with the country ranked as the sixth largest orange producer in the world in the 2016/17 season, according to the USDA. Local and international demand has helped boost production in the past decade, with total volumes growing from 1.83m tonnes in the 2006/07 season to 3m tonnes by 2016/17, according to figures by USDA. However, profits could be boosted through greater involvement from the agro-industrial sector, as only 3% of orange output is processed. As much as 51% of annual production is exported and the remaining 46% is consumed locally, according to USDA.

Domestic demand has also helped push the total cultivated area of orange trees from an estimated 146,950 ha in 2016/17 to 152,000 ha by the 2017/18 season. In 2016/17 Egypt was the second biggest orange exporter after Spain, with Russia and Saudi Arabia accounting for more than 40% of exports.


To meet the needs of a rapidly growing population, the government has sought to secure sufficient access to basic cereals such as rice, corn and wheat. However, due to insufficient local production, there has been a reliance on imports, which has led to spikes in inflation whenever international prices have rise abruptly. Wheat demand stands at around 20m tonnes per year and is well above an annual output of 8.5m tonnes. As a result, the country is the world’s largest wheat importer, buying 12m tonnes of the commodity in the 2017/18 season.

Rice is another key staple, although its high water consumption has driven the government to curb production. In early 2018 the MIWR reduced the allocated rice production area from 453,600 ha to 304,164 ha. To ensure the application of its policy, fines were levied on farmers with rice plantations outside the total maximum area determined by the government. Although this policy has not been able to keep total production areas under the designated threshold, it has been able to reduce rice production and curb water use, saving 84.9m cu metres of water in 2018 alone. Total rice production was forecast at 3.3m tonnes for 2017/18, down from 4.8m tonnes in 2016/17, according to the USDA.


Attracting an increasing amount of government attention, sugar has been gaining ground as a key agricultural commodity. This is partly due to the government’s food subsidy programme, which has long included sugar. In the 2018/19 season sugar production is expected to increase by roughly 5% to 2.4m tonnes. Egypt produces sugar from both sugar cane, which was forecast to account for roughly 1.1m tonnes, and sugar beet, projected to yield 1.3m tonnes. The total area of land used for sugar cane was set to reach 125,000 ha in 2016/17 according to USDA projections. Over 70% of sugar cane production is centred in Upper Egypt, close to sugar refining plants. Several rural communities depend on sugar cane production and processing, which according to figures from the USDA supports roughly 500,000 families in Upper Egypt alone.

Key investments in new processing facilities are expected to continue driving the segment’s expansion over the coming years. The first phase of a LE3.5bn ($196.7m) sugar production unit was set to begin operations in mid-2018 in the Sharqia Governorate, which is the third most populous governorate in Egypt. The project is being developed by domestic firm Al Nouran Sugar and will be able to produce 300,000 tonnes of sugar every year in its initial stage of operation.

A full extension of the plant’s capacity is expected to be finalised in 2025, according to local media, bringing total annual output of refined sugar to 1.2m tonnes. Additional investment in the sugar industry was announced in early 2018 by a consortium of companies led by the UAE-based firm Al Ghurair Group, which is set to invest $1bn in a sugar refinery in the Minya Governorate, south of Cairo. The plant is scheduled to be fully operational by 2021 and have an annual output of 900,000 tonnes.


Egypt’s natural competitive advantages should allow its agriculture sector to strengthen as the economy recovers over the near term, and recent government policy has allowed for an increase in the recommended sale prices for several crops, helping sustain the livelihoods of millions of Egyptians that depend on farming. Furthermore, the establishment of clearer quality standards is already helping to drive exports to new markets in Asia.

Ongoing strategies that safeguard diminishing water resources and farmland should enhance the sector’s development, while further integration of distribution channels could assist small-scale farmers in accessing export markets. Coordination between agricultural production and processing capacity also has the potential to boost revenues.