Egypt talking to banks about hedging for commodities

Egypt, the world’s largest wheat importer, is in the early stages of talks with international banks over a plan to hedge against the global rise in commodity prices, a government source said on Monday.

“We are not in advanced talks...we are surveying, taking presentations, not more than that,” the source said, adding that there was no deadline set for the completion of the talks.

Egypt’s Finance Minister Mohamed Maait said in September his country was ready to implement an oil hedging policy but was waiting for the market to cool off.

Another government source earlier on Monday said that Egypt was also talking to banks over a scheme to hedge against the rise in wheat prices but did not give further details.

“There are many units in many ministries working on this,” the first government source said. “A unit in the finance ministry is studying the potential for hedging the price of oil and basic commodities.”

Cairo spends around $1.5 billion annually on wheat imports to stock a sprawling bread subsidy programme relied on by tens of millions of Egyptians.

In other news, shares in Egypt’s Sarwa Capital fell 15.1 percent on their first day of trading on the Egyptian stock exchange, bourse data showed on Monday.

Sarwa’s flotation is among a number of new share offerings from both private and state companies expected to test investor appetite in Egypt over the coming months.

Sarwa’s shares began trading at 7.36 Egyptian pounds per share after a public and private offering worth 2.17 billion Egyptian pounds ($121.5 million). They closed at 6.25 pounds per share. (RTRS)