The Egyptian government has increased the price it pays local farmers for sugar cane by 25 percent, the Ministry of Supplies said on Tuesday.
Sugar companies belonging to the Ministry of Supplies will buy local sugar cane from farmers for 500 Egyptian pounds (around US$26.11) per ton, up from 400 pounds in the previous season, the statement said.
Sugar has become scarce in recent months. The government took control of stocks to counter what it said was an epidemic of hoarding by merchants reacting to rising prices amid a shortage of foreign currency before the local currency flotation that took place on November 3.
Egypt consumes 3 million tons of sugar a year but produces just over 2 million tons, with the gap filled by government and private imports, usually purchased between July and October each year.
The Supply Ministry raided sugar factories nationwide in August and seized 250,000 tons — most of the reserves held by the private sector — to secure supplies for its own subsidized food outlets, after failing to procure its usual sugar shipments on time.