Egypt seeks to weave cotton renaissance

A picture taken on September 13, 2018 shows an Egyptian farmer working in a cotton field in the Egyptian Nile Delta town of Kafr el-Sheikh. (AFP)
Updated 14 October 2018

Egypt seeks to weave cotton renaissance

  • Cotton was once Egypt’s main source of wealth in the 19th century
  • Egypt’s cotton union says buyers are even demanding lower prices, without triggering any intervention by the government

CAIRO: Treading carefully among his sprawling green plants in the Nile Delta, Egyptian farmer Fatuh Khalifa fills his arms with fluffy white cotton picked by his workers.
Durable, fine and luxuriously soft, cotton sourced from Egypt has long been seen as the best on the market.
But recent years have been far from smooth for the North African country’s farmers.
“I cultivate 42 hectares (104 acres) and it’s expensive ... while the price (of cotton) is very low,” said Khalifa, who has been growing the premium long-fiber variety for over 30 years.
Profits are “meagre,” he lamented, his head shaded by his cap from the unforgiving sun on his farm in Kafr El Sheikh.
Cotton was once Egypt’s main source of wealth in the 19th century, as the Nile Delta provided fertile grounds for the crop used to make the towels, sheets and robes coveted by Europe’s burgeoning bourgeoisie.
But decades of fierce international competition has diminished returns.
Well-marketed short-fiber cotton — while lower quality than the long-fiber variety — looks good and has increasingly been used by textile giants, dealing a heavy blow to Egyptian players.
The United States and Brazil are now the world’s top cotton exporters, according to this month’s report by the US Department of Agriculture, followed by India and Australia, leaving Egypt trailing far behind.
Back in 1975, Egypt exported $540 million of cotton. By 2016, the sector’s export receipts had fallen to $90.4 million, according to the Massachusetts Institute of Technology.
The popular uprising that toppled president Hosni Mubarak in 2011 dealt a fresh blow to the cotton sector, as political and economic chaos hit production and export chains.
Egypt’s output of cotton fibers fell as low as 94,000 tons in 2013, according to the UN’s Food and Agriculture Organization, down from 510,000 tons in 1971.
Last year brought producers some respite, thanks to rising prices and higher export volumes.
But a trade spat between the US and voracious importer China has seen benchmark global cotton prices fall afresh, as traders take fright over Beijing imposing tariffs.
The commodity was trading at a shade under $0.77 per pound (0.45 kilos) in early October, after reaching $0.95 — the highest level in more than six years — in early June.
In Egypt, the price has dropped back to the minimum guaranteed by the state of some 2,700 Egyptian pounds ($150, 130 euros) per 100 kilos.
Egypt’s cotton union says buyers are even demanding lower prices, without triggering any intervention by the government.
Others offer a different diagnosis of the sector’s ills.
“The drop in prices is not in itself a bad thing,” said Ahmed El-Bosaty, CEO of Modern Nile Cotton, one of the biggest companies in the sector.
Bosaty said the major challenge is boosting productivity.
“A rise in productivity rather than prices would ensure better incomes for workers,” he said.
A cotton expert at the agriculture ministry acknowledged that modernization is key.
“Productivity is rising,” said Hisham Mosaad. But cotton enterprises must invest in mechanization, as the industry is still entirely manual, he added.
Another challenge is that few Egyptian firms make finished products.
“We produce raw cotton for direct export,” said Mohammed Sheta, director of research at the Kafr El Sheikh cotton institute.
Egypt does not have “the factories or the means allowing us to transform it into fabric,” he lamented.
The state has tried to spur activity, boosting areas under cultivation over the last four years by around 50,000 hectares, to more than 140,000 hectares.
In an experimental move, the government in September even allowed the cultivation of short-fiber cotton, but only outside the Delta region.
Experts and farmers remain skeptical, believing Egypt will struggle against foreign heavyweights in the short-fiber market segment.
But many companies see the situation as urgent.
Even though official exports of Egyptian cotton rose 6.9 percent by volume in the three months to the end of May compared to the same quarter of 2017, there was a 57.9-percent fall in consumption of Egyptian cotton at home, due to the domestic market turning to imported products.
At the high end of the value chain, designer Marie Louis Bishara runs one of the few Egyptian firms that produces high quality finished products locally for the international market.
Young men and women work side by side in her modern factory in northern Cairo, in roles ranging from overseeing looms to packing finished shirts.
Promising Egyptian quality, she has dedicated one of her lines to local long-fiber cotton.
“We try to show the world that if you want to make luxury products, you have to use extra long cotton from the Delta,” she said.
Shirts, trousers and jackets stamped “Made in Egypt” have gone from the design stage on her factory floor to grace shop shelves in France, Italy and her home country.


Saudi companies display latest technologies at Dubai Airshow

Updated 17 November 2019

Saudi companies display latest technologies at Dubai Airshow

DUBAI: Over 25 Saudi companies and government institutions are taking part in the Dubai Airshow hoping to snag deals for their latest defense and aviation technologies being showcased at the biennial event.

The Middle East’s biggest aviation gathering opened on Sunday sans major announcements for big-ticket aircraft purchases from Gulf flagship carriers, maybe also due to dozens of deals already been previously signed and the planes just waiting to be delivered.

Among the major Saudi companies in the event include the Saudi Arabian Military Industries (SAMI), fully owned by the Public Investment Fund, which has operations from aeronautics, land systems, naval systems, weapons and missiles and defense electronics.

SAMI aims to become among the top 25 companies globally by 2030 and to localize military spending, in line with the Kingdom’s vision.

Among other notable Saudi companies and institutions with a presence at the airshow are Saudi Airlines, flynas, The General Authority of Civil Aviation and the King Abdulaziz City for Science and Technology.

Meanwhile, Saudi INTRA Defense Technologies signed a Memorandum of Agreement with multinational defense company Hensoldt for the co-development and co-production of advanced electro-optic systems, as well as a joint venture agreement with EM&E for the transfer of technology and localization of the precision mechanical industries in the Kingdom.

ESEN Saudi, a hi-tech defense and aerospace engineering and production company, was also launched at the Dubai Airshow’s opening day.

Middle East Propulsion Company, which specializes in maintenance, repair and operations (MRO) for the Middle East, was also one of the Saudi companies on site. The company, which boasts of a workforce comprised of Saudi nationals of about 80 percent, aims to expand their services across the GCC and wider Middle East region.

Al-Salam Aerospace Industries meanwhile has on display latest advancements in the manufacture of key components for the F-15 fighter jet.