Blumberg Grain and the Egyptian government have been working together since November 2015 to improve Egypt's grain storage system. 
CAIRO, EGYPT — Egypt is one of the E.U.’s largest wheat buyers and it has been losing wheat due to its grain storage system. Blumberg Grain and the Egyptian government have been working together since November 2015 to improve the grain storage system. 

The International Grains Council (IGC) puts total grains imports by Near East Asia at 51.4 million tonnes for 2016-17. Of the 51.4 million tonnes, 19.8 million tonnes are forecast to be imported by Egypt, the IGC said. 

Currently, Egypt uses shounas, open-air storage plots, which allows for air, birds and rodents and other contaminates to enter the grain storage.  On Aug. 11, Blumberg Grain met with the Prime Minister of Egypt, Eng. Sherif Ismail, the Minister of Internal Trade, Khaled Hanafy, and other government officials to discuss phase 2 of the Shouna Development Project for Egypt. 

Blumberg Grain is a global food security company, providing harvest protection systems and technology. Blumberg Grain works with private companies and countries to modernize agricultural value chains, increase the quality and marketable output of their harvests, enable efficient market timing, and significantly boost exports of agriculture products.

Blumberg Grain completed phase 1 of the Shouna Development Project for Egypt in April 2016, installing 93 Blumberg Grain Aggregation and Processing Centers across the country. The systems transformed existing earthen shouna into advanced food security facilities by providing the Egyptian government with the advanced technology necessary to receive, clean, grade, and safely store their grains, the company said.

The second phase of the Shouna Development Project includes the development of 300 new Blumberg Grain Aggregation and Processing Centers to complete the entire shouna network.

Blumberg Grain’s phase 2 design has been modified to be installed outdoors on a smaller footprint that allows for use on any shouna site, regardless of size or layout.

The phase 2 project also includes a Blumberg Grain Command, Control, and Logistics Center (CCLC) 2.0 upgrade, bringing the highest levels of food security technology and logistics-management systems to Egypt.

Blumberg Grain David Blumberg
David Blumberg, chief executive officer of the Middle East and Africa for Blumberg Grain.
“We have been very impressed by the prime minister, and while we haven’t resolved the modest issues that stand in the way of phase 2 project implementation, given the high impact of this project, and the Sisi administration’s emphasis on combatting corruption, the need to increase hard currency, and help farmers, we are confident that the Egyptian government will do everything in its power to ensure the rapid development of the entire shouna network,” said David Blumberg, chief executive officer of the Middle East and Africa for Blumberg Grain. 

Through this system, Egypt will have an accurate, up-to-the-minute, digital inventory of its grain under storage, which will assist in combatting corruption across the wheat value chain. Phase 2 will generate additional annual savings to Egypt of $350 million, Blumberg Grain said.

“According to a study done by KPMG, the Egyptian government stands to save $550 million a year in wheat losses through the implementation of Blumberg Grain’s systems,” David Blumberg said. “This also has a dramatic impact on Egypt’s foreign exchange, as the government depletes its hard currency to import wheat from abroad to make up for
these losses.”

An investment plan also was introduced by Blumberg Grain during the Aug. 11 meeting. The plan would make Egypt Blumberg Grain’s headquarters and hub for the Middle East and Africa, and would include the following investments: 

• the development of a manufacturing plant and export hub in East Port Said to produce industrial refrigeration for Egypt and export across the region.

• the establishment of an agricultural institute, in partnership with U.S. and Egyptian universities, which will bring the most productive, high yield, and green techniques to Egyptian farmers.

• the commissioning of a greenhouse project feasibility study that provides a roadmap for Egyptian President Sisi’s vision to create 100,000 greenhouses in Egypt (Blumberg is prepared to participate in the development of those greenhouses at cost, for the benefit of Egypt and its farmers).

• the redevelopment of a bagging facility in the Suez to create bags for the storage of grain to be exported globally.

• the creation of one of the largest cold chain terminals in the Mediterranean at the Port of Damietta.

The impact of these investments on the Egyptian economy would be over $8 billion in five years, and will generate high levels of hard currency as Blumberg Grain exports made-in-Egypt products across the world, the company said.
Blumberg requires no financing for the projects, which the company expects it would see an injection of U.S. foreign direct investment, and likely attract other U.S. companies to Egypt.
The phase 2 Shouna Development Project and investment program come as a package deal, the company said.

Blumberg Grain said it is hoping to come to an agreement within the next two weeks with Egypt as there are other countries competing for the investment program. 

If the agreement is made the goal is to have phase 2 of the Shouna Development Project completed by 2017 and the whole system complete by harvest 2018, the company said. 

Blumberg Grain Philip Blumberg
Philip Blumberg, chairman of Blumberg Partner.
“A fast response from Egypt is critical to us moving forward with this investment program,” said Philip Blumberg, chairman of Blumberg Partner. “We are fortunate to be working with a Prime Minister like Sherif Ismail, and are sure that he will be able to address our timeframes, given the very large and very high job creation program that our investment program will bring to Egypt.”