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The Ethiopian Grain Trade Enterprise (EGTE) which distributes wheat to Ethiopia’s nine regions and two administrations is running out of stock due to delayed procurement of wheat from abroad.
The Enterprise had been distributing 640,000 quintals per month to trade bureaus, universities, and prison administrations and has only 50,000 quintals remaining in its stock which has caused them to delay this month’s distribution.
Currently four million quintals of wheat are under the procurement process but it will take over two months before this reaches EGTE.
EGTE, out of concern, has requested one million metric tons of wheat as a loan from the Emergency Food Security Reserve Administration (EFSRA).
However they have not gotten a response, so the Agency has made a second request, this time to the National Disaster Risk Management Commission (NDRMC) which did approve an unspecified amount of wheat.
Due the shortage EGTE cut the supply of wheat by 50 percent last month. They have also been purchasing wheat from the local market for between 1,000-1,200 birr per quintal.
A source at the Enterprise told Capital that shortages of bread and other products could occur if wheat is not loaned out or procured faster.
“Several months ago we cut the supply of wheat by 25 percent but we recovered soon because of the speedy procurement process but now it has slowed down and our stock is almost empty. There is only a small amount reserved for universities, defense and prisoners in jail. We are waiting for NDRMC to save us from our current problem.’’
Under normal circumstances regions and administrations receive the following number of quintals of wheat per month: Oromia (125,305), Amhara (72,550), Tigray (66,417), Addis Ababa (168,000). Somali (21,716), Afar (2,875), Gambella (20,700) Beneshal Gamuz (20,001).
EGTE sells the wheat at 550 birr per quintal to the trade bureaus who in turn sells it to the flour factories and then finally to the bakeries.
Last January the government canceled a 2.6 billion birr contract awarded to Pakistan based Shakeel & Company to supply 400,000 metric tons of wheat because they didn’t provide a performance guarantee and subsequently didn’t supply the wheat.
Last March, the Public Procurement & Property Disposal Service, PPPDS, opened a tender to supply four million quintals of wheat. The tender includes 10 lots, each with 400,000 quintals. Of this amount 500,000 quintals are expected to be supplied this fiscal year and the rest during the next fiscal year. Currently, two million quintals of wheat on its way to the country but is facing delays at port of entry. Those two million quintals were supplied by, Promising International Trading, (800,000 quintals) and Hakan Agro Industry (1.2 million quintals).