Required Report - public distribution

**Date:** 8/24/2005

**GAIN Report Number:** EG5016

EG5016

**Egypt**

### Livestock and Products

**Annual**

**2005**

**Approved by:**

![](media/image1.wmf)Fred Giles

#### U.S. Embassy, Cairo

**Prepared by:**

Sherif Ibrahim

**Report Highlights:**

In March 2005, the government of Egypt removed its ban on imports of
beef and beef products from the United States. Beef and cattle imports
are expected to increase in 2005 as a direct result of the removal of
the ban.

Includes PSD Changes: Yes

Includes Trade Matrix: Yes

Annual Report

Cairo \[EG1\]

\[EG\]

Table of Contents

[PSD Table 3](#psd-table)

[Production 3](#production)

[Import Trade Matrix 5](#import-trade-matrix)

[Consumption 5](#consumption)

[Prices 6](#prices)

[PSD Trade 6](#__RefHeading___Toc112649076)

[Trade 6](#trade)

[Import Trade Matrix 8](#import-trade-matrix-1)

# PSD Table

+---------------------+--------+--------+--------+--------+-----+------+
| **Egypt**           |        |        |        |        |     |      |
|                     |        |        |        |        |     |      |
| ######### **Cattl   |        |        |        |        |     |      |
| e (Thousand head)** |        |        |        |        |     |      |
+---------------------+--------+--------+--------+--------+-----+------+
|                     |        | **     |        | **     |     | **20 |
|                     |        | 2004** |        | 2005** |     | 06** |
+---------------------+--------+--------+--------+--------+-----+------+
|                     | Old    | New    | Old    | New    | Old | New  |
+---------------------+--------+--------+--------+--------+-----+------+
| ######              |        | **01/  |        | **01/  |     | **0  |
| Calendar Year Begin |        | 2003** |        | 2005** |     | 1/20 |
|                     |        |        |        |        |     | 06** |
+---------------------+--------+--------+--------+--------+-----+------+
| Total Cattle Beg.   | 6,340  | 6,500  | 6,319  | 6,415  | 0   | 6    |
| Stks                |        |        |        |        |     | ,343 |
+---------------------+--------+--------+--------+--------+-----+------+
| Dairy Cows Beg.     | 4,186  | 4,290  | 4,190  | 4,234  | 0   | 4    |
| Stocks              |        |        |        |        |     | ,186 |
+---------------------+--------+--------+--------+--------+-----+------+
| Beef Cows Beg.      | 0      | 0      | 0      | 0      | 0   | 0    |
| Stocks              |        |        |        |        |     |      |
+---------------------+--------+--------+--------+--------+-----+------+
| Production (Calf    | 2,217  | 2,221  | 2,220  | 2,202  | 0   | 2    |
| Crop)               |        |        |        |        |     | ,302 |
+---------------------+--------+--------+--------+--------+-----+------+
| Intra EC Imports    | 0      | 0      | 0      | 0      | 0   | 0    |
+---------------------+--------+--------+--------+--------+-----+------+
| Other Imports       | 0      | 2      | 50     | 70     | 0   | 100  |
+---------------------+--------+--------+--------+--------+-----+------+
| TOTAL Imports       | 0      | 2      | 50     | 70     | 0   | 100  |
+---------------------+--------+--------+--------+--------+-----+------+
| **TOTAL SUPPLY**    | **8    | **8    | **8    | **8    | **  | *    |
|                     | ,557** | ,723** | ,589** | ,687** | 0** | *8,7 |
|                     |        |        |        |        |     | 45** |
+---------------------+--------+--------+--------+--------+-----+------+
| Intra EC Exports    | 0      | 0      | 0      | 0      | 0   | 0    |
+---------------------+--------+--------+--------+--------+-----+------+
| Other Exports       | 0      | 0      | 0      | 0      | 0   | 0    |
+---------------------+--------+--------+--------+--------+-----+------+
| TOTAL Exports       | 0      | 0      | 0      | 0      | 0   | 0    |
+---------------------+--------+--------+--------+--------+-----+------+
| Cow Slaughter       | 528    | 567    | 530    | 560    | 0   | 565  |
+---------------------+--------+--------+--------+--------+-----+------+
| Calf Slaughter      | 170    | 173    | 175    | 171    | 0   | 172  |
+---------------------+--------+--------+--------+--------+-----+------+
| Other Slaughter     | 1,260  | 1,308  | 1,365  | 1,363  | 0   | 1    |
|                     |        |        |        |        |     | ,370 |
+---------------------+--------+--------+--------+--------+-----+------+
| Total Slaughter     | 1,958  | 2,048  | 2,070  | 2,094  | 0   | 2    |
|                     |        |        |        |        |     | ,107 |
+---------------------+--------+--------+--------+--------+-----+------+
| Loss                | 280    | 260    | 270    | 250    | 0   | 250  |
+---------------------+--------+--------+--------+--------+-----+------+
| Ending Inventories  | 6,319  | 6,415  | 6,249  | 6,343  | 0   | 6    |
|                     |        |        |        |        |     | ,388 |
+---------------------+--------+--------+--------+--------+-----+------+
| **TOTAL             | **8    | **8    | **8    | **8    | **  | *    |
| DISTRIBUTION**      | ,557** | ,723** | ,589** | ,687** | 0** | *8,7 |
|                     |        |        |        |        |     | 45** |
+---------------------+--------+--------+--------+--------+-----+------+

## Production 

Egypt's total number of livestock herd is currently estimated at 6.5
million out of which, fifty-five percent is buffaloes and forty-five
percent cows. Most of the herd is maintained primarily for dairy
production, with meat production being of secondary importance. Most
animals are fed in confinement due to the lack of pastureland. Although
the bulk of the national herd is dispersed among a large number of small
holders, the number of modern farms for both dairy and beef production
is increasing. The total number of modern dairy farms currently is
estimated at 35, with a total of about 218,000 of high milk-producing
imported cows (mostly from the U.S).

The continued success of the National Buffalo Project (NBP) has
encouraged more investors to establish feedlots for beef fattening. The
number of beef farms is increasing rapidly, and is currently estimated
at 220 farms with sizes varying between 200 to 2000 heads. The objective
of this project, which was re- launched eight years ago, is to fatten
the maximum number of buffalo calves to a live weight of 450-500
kilograms in order to reduce reliance on imported live animals or frozen
meat. In 2004, the NBP accounted for approximately 350,000 heads of the
total herd, compared to 340,000 heads in 2003. It is estimated that the
total number is currently 355,000 heads. While most cow calves are
fattened up to 360-450 kg live weight, approximately 60 percent of
buffalo calves are slaughtered at 70-80 kilograms live weight for veal
production, and the balance is fattened up to 450 kg. In 2004, the total
number of animals slaughtered for meat is estimated at 2,048,000 heads,
of which sixty seven percent were buffaloes and thirty-three percent
were cows. Total meat production in 2004 is estimated at 455,000 MT. In
2005, an increase to 461,000 MT is expected, due to the expected
increase in imports of live animals for slaughter from Ethiopia and
Sudan. An overall increase in both the number of slaughtered animals and
meat production is expected for 2005, as a result of opening the market
to other exporters.

The fragmentation of the national herd is a major constraint to the
development of the livestock sector in Egypt. The majority of the
producers have only a few heads of cattle and remain largely
ill-informed about recent technological advances as extension programs
designed to improve animal nutrition, health, and breeding are difficult
to administer. Herd improvement through artificial insemination is only
practiced on large dairy farms.

Many farms currently mix their feed rations on the farm. These rations
consist of corn, cottonseed meal or soybean meal, wheat bran and farm
by-products (rice straw, rice hulls, bean straw, barely straw),
molasses, limestone and, vitamins and salt. According to government feed
regulations, growth hormones and ruminant by products are prohibited
from use in manufacturing animal feed.

Some of the problems that impact the efficiency of meat production in
Egypt arise from the lack of adequate packaging, sanitation, and quality
control. Currently, there are 355 slaughterhouses in operation in Egypt.
Most of these are small one-room operations, but there are eight
industrial facilities located in Cairo and Alexandria where about 45
percent of the slaughtering takes place. Animals are slaughtered
according to Islamic requirements. About 50 percent of the slaughtered
cattle and buffalo, and 60 percent of the slaughtered calves are
slaughtered outside specialized slaughterhouses, either on farms or in
villages.

# 

# Import Trade Matrix

+---------------------+-----------+-----------+-----------+-----------+
| ######## Egypt      |           |           |           |           |
|                     |           |           |           |           |
| **Animal Numbers**  |           |           |           |           |
+---------------------+-----------+-----------+-----------+-----------+
| Partial Begin       | Jan       |           |           |           |
+---------------------+-----------+-----------+-----------+-----------+
| Partial End         | May       |           |           |           |
+---------------------+-----------+-----------+-----------+-----------+
| **Exports for**     | **2003**  | **2004**  | **2004**  | **2005**  |
+---------------------+-----------+-----------+-----------+-----------+
|                     | **Full**  | **Full**  | **        | **        |
|                     |           |           | Partial** | Partial** |
+---------------------+-----------+-----------+-----------+-----------+
| U.S.                | 0         | 0         | 0         | 0         |
+---------------------+-----------+-----------+-----------+-----------+
| ####### Others      |           |           |           |           |
+---------------------+-----------+-----------+-----------+-----------+
| Australia           | 3,000     | 0         | 0         | 0         |
+---------------------+-----------+-----------+-----------+-----------+
| Ethiopia            | 0         | 0         | 0         | 12,159    |
+---------------------+-----------+-----------+-----------+-----------+
| Romania             | 0         | 1,208     | 527       | 7,100     |
+---------------------+-----------+-----------+-----------+-----------+
| Moldova             | 0         | 0         | 0         | 1,006     |
+---------------------+-----------+-----------+-----------+-----------+
| Hungary             | 0         | 792       | 319       | 0         |
+---------------------+-----------+-----------+-----------+-----------+
| **Total for         | 3,000     | 2,000     | 846       | 20,265    |
| Others**            |           |           |           |           |
+---------------------+-----------+-----------+-----------+-----------+
| **Others not        |           |           |           |           |
| listed**            |           |           |           |           |
+---------------------+-----------+-----------+-----------+-----------+
| **Grand Total**     | **3,000** | **2,000** | **846**   | *         |
|                     |           |           |           | *20,265** |
+---------------------+-----------+-----------+-----------+-----------+

## Consumption 

## 

In 2004, total red meat consumption is estimated to be 569,000 MT, of
which 80 percent is locally produced. This represents 6 percent increase
above the 2003 level, resulting from an increase in frozen meat
consumption. In 2005, meat consumption is expected to further increase
after the ban on some European and African imports was lifted. In
addition, the removal of the seven percent maximum fat limitation was
applied on imported frozen meat for direct consumption.

The average per capita consumption of red meat is estimated at 8.7
kg/year, which is quite low compared to consumption levels in other
countries. The low consumption is mainly due to limited local production
combined with low income. Also there continues to be a restriction on
the importation of red meat for direct consumption from other sources.
Egyptians prefer beef to other types of meat including poultry and lamb.
They also prefer fresh over frozen beef. The more affluent segment of
the population tends to think of imported frozen meat as an inferior
product. The exception to this is the very limited amount of high
quality beef imported for use in hotels and restaurants, mostly imported
from the United States.

Imported beef liver is established as a relatively cheap source of
protein. From the end of 2003 until March 2005, there was an import ban
on U.S beef products. Prior to the ban, the U.S. owned more than 95
percent of the market for beef livers. It is estimated that about 60
percent of imported livers is sold by street vendors for sandwiches,
while 40 percent is consumed at home. Competition to beef livers comes
from other sources of comparatively cheap animal protein such as
imported frozen fish and low price beef cuts from the EU such as
briskets.

# Prices

The price for local live cattle in May - June 2005 is reported to be LE
12.5 per kg live weight for cows and LE 11 per Kg for buffalo. The
prices of imported frozen beef from Brazil and Argentina during May -
June 2005 are reported to be \$ 2,800 MT/CIF for hindquarters, \$2,350
MT/CIF for forequarters (about \$60 per MT over last year's prices
during the same period). Australian beef is currently imported at about
\$50 per MT higher than other sources (South American countries).
Imported frozen beef currently retails between LE 16 and LE 18 per kg.
The retail prices for locally produced beef vary between LE 25 and 45
per kg. Imported frozen beef liver is currently imported at \$1050 per
MT CIF and retails between LE 9 and 11 per kg, compared to LE 35 per kg
for fresh liver.

[]{#__RefHeading___Toc112649076 .anchor}

## PSD Trade 

+----------------------+-------+-------+-------+-------+-------+-------+
| **Egypt**            |       |       |       |       |       |       |
|                      |       |       |       |       |       |       |
| **Meat (Thousand     |       |       |       |       |       |       |
| MT)**                |       |       |       |       |       |       |
+----------------------+-------+-------+-------+-------+-------+-------+
|                      |       | **2   |       | **2   |       | **2   |
|                      |       | 004** |       | 005** |       | 006** |
+----------------------+-------+-------+-------+-------+-------+-------+
|                      | Old   | New   | Old   | New   | Old   | New   |
+----------------------+-------+-------+-------+-------+-------+-------+
| ######               |       | *     |       | *     |       | *     |
|  Calendar Year Begin |       | *01/2 |       | *01/2 |       | *01/2 |
|                      |       | 004** |       | 005** |       | 006** |
+----------------------+-------+-------+-------+-------+-------+-------+
| Slaughter            | 1,962 | 2,048 | 2,070 | 2,094 | 0     | 2,107 |
| (Reference)          |       |       |       |       |       |       |
+----------------------+-------+-------+-------+-------+-------+-------+
| Beginning Stocks     | 0     | 0     | 0     | 0     | 0     | 0     |
+----------------------+-------+-------+-------+-------+-------+-------+
| Production           | 453   | 455   | 455   | 461   | 0     | 464   |
+----------------------+-------+-------+-------+-------+-------+-------+
| Intra EC Imports     | 0     | 0     | 0     | 0     | 0     | 0     |
+----------------------+-------+-------+-------+-------+-------+-------+
| Other Imports        | 70    | 114   | 75    | 120   | 0     | 140   |
+----------------------+-------+-------+-------+-------+-------+-------+
| TOTAL Imports        | 70    | 114   | 75    | 120   | 0     | 140   |
+----------------------+-------+-------+-------+-------+-------+-------+
| **TOTAL SUPPLY**     | 523   | 569   | 530   | 581   | 0     | 604   |
+----------------------+-------+-------+-------+-------+-------+-------+
| Intra EC Exports     | 0     | 0     | 0     | 0     | 0     | 0     |
+----------------------+-------+-------+-------+-------+-------+-------+
| Other Exports        | 0     | 0     | 0     | 0     | 0     | 0     |
+----------------------+-------+-------+-------+-------+-------+-------+
| TOTAL Exports        | 0     | 0     | 0     | 0     | 0     | 0     |
+----------------------+-------+-------+-------+-------+-------+-------+
| Human Dom.           | 523   | 569   | 530   | 581   | 0     | 604   |
| Consumption          |       |       |       |       |       |       |
+----------------------+-------+-------+-------+-------+-------+-------+
| Other Use, Losses    | 0     | 0     | 0     | 0     | 0     | 0     |
+----------------------+-------+-------+-------+-------+-------+-------+
| TOTAL Dom.           | 523   | 569   | 530   | 581   | 0     | 604   |
| Consumption          |       |       |       |       |       |       |
+----------------------+-------+-------+-------+-------+-------+-------+
| Ending Stocks        | 0     | 0     | 0     | 0     | 0     | 0     |
+----------------------+-------+-------+-------+-------+-------+-------+
| **TOTAL              | **    | **    | **    | **    | **0** | **    |
| DISTRIBUTION**       | 523** | 569** | 530** | 581** |       | 604** |
+----------------------+-------+-------+-------+-------+-------+-------+

# Trade

Restrictions on the importation of live cattle from most EU countries
because of BSE and FMD concerns continue to have an impact on imports of
beef cattle from those countries, especially Ireland who was a major
supplier of live cattle to Egypt. In 2004 and 2005, Ethiopia, Romania
and Hungary were the major suppliers of beef cattle to Egypt. Total beef
cattle imports in 2004 are estimated at 2,000 heads, of which 1,208
heads were imported from Romania and 792 from Hungary. In 2005, Egypt
opened its market to imports from Africa. Total beef cattle imported
from January 2005, through the end of May 2005 is estimated at 20,265
heads of which 12,159 heads came from Ethiopia, 7,100 heads came from
Romania and 1,006 from Moldova.

For 2006, imports of beef cattle are expected to be mostly from the same
countries, unless the government decides to remove its ban on Irish
cattle imports. U.S. dairy cattle imports have been banned since June
2001 when MOA issued decree #1355 of 1998. The decree requires that
imported cattle be from a country or area declared as enzootic bovine
leukosis (EBL) free. The U.S. is not declared as EBL free; therefore,
importation of U.S. dairy cattle was not permitted. However, as a result
of joint efforts between U.S. industry, importers and FAS/Cairo, along
with USDA/ APHIS, the Egyptian government decided to consider breeding
cattle coming from a biosecured farm under the supervision of the
official veterinary authorities as coming from EBL free herds. Egyptian
dairy farmers continue to favor U.S. dairy cattle for their higher milk
production (27 Kg/day in their first lactation) compared with 16 kg/day
for other cattle from other sources. However, according to Egyptian
importers, the high prices of U.S dairy cattle which are currently
between \$2,800 CIF for non registered and about \$3,300 CIF for
registered cattle, are about \$1,000 higher than the landed price for
Australian dairy cattle. As a result, importers are forced to consider
suppliers from other countries such as Australia, Canada and New
Zealand, which GOE reportedly considers free of EBL. However, FAS Cairo
is currently working with the Egyptian Veterinary Authorities in order
to alleviate its quarantine requirements on imported dairy cattle from
the U.S., which required 90 days of quarantine for animals imported from
the U.S.

In 2004, Egyptian imports of frozen beef are estimated at 144,000 MT,
compared to 107,972 MT in 2003. In 2005, beef imports are expected to
increase by about 5 percent, due to the recent opening of the
importation market for several countries, including the U.S. Brazil and
Argentina continue to be the major suppliers of imported frozen meat to
Egypt.

Currently, the United States is not a major beef supplier to Egypt. This
is due to lack of price competitiveness in addition to the Egyptian
labeling requirements included in the Decree \# 465 of 1997 which
stipulates that exporters must insert the name of the importers inside
and outside the products' package. U.S. beef exports to Egypt are
limited to high quality cuts with extra trimming mostly for tourist
facilities and hotels. Egypt usually imports about 2,000 MT of high
quality beef from the United States every year.

In 2004, Egypt's total beef liver imports declined dramatically, from
32,000 MT in 2003 to an estimated 5,000 MT, mostly from Argentina and
Brazil. This decline resulted from the import ban imposed by the
government of Egypt in December 2003, due to the BSE case found in
Washington State. The United States was the sole supplier before the
imposition of the ban in 2003. With the removal of the ban in March
2005, U.S. beef liver exports are expected to recover during the rest of
2005 and into 2006.

## 

## Import Trade Matrix

+----------------------+-----------+-----------+-----------+-----------+
| **Egypt**            |           |           |           |           |
|                      |           |           |           |           |
| **Meat (MT)**        |           |           |           |           |
+----------------------+-----------+-----------+-----------+-----------+
| Partial Begin        | Jan       |           |           |           |
+----------------------+-----------+-----------+-----------+-----------+
| Partial End          | May       |           |           |           |
+----------------------+-----------+-----------+-----------+-----------+
| **Exports for**      | **2003**  | **2004**  | **2004**  | **2005**  |
+----------------------+-----------+-----------+-----------+-----------+
|                      | **Full**  | **Full**  | **        | **        |
|                      |           |           | Partial** | Partial** |
+----------------------+-----------+-----------+-----------+-----------+
| U.S.                 | 0         | 1,070     | 0         | 0         |
+----------------------+-----------+-----------+-----------+-----------+
| ####### Others       |           |           |           |           |
+----------------------+-----------+-----------+-----------+-----------+
| Uruguay              | 3,530     | 0         | 0         | 45,000    |
+----------------------+-----------+-----------+-----------+-----------+
| India                | 32,847    |           |           |           |
+----------------------+-----------+-----------+-----------+-----------+
| Brazil               | 44,311    | 93,000    | 50,369    | 35,000    |
+----------------------+-----------+-----------+-----------+-----------+
| China                | 21,963    | 0         | 0         | 0         |
+----------------------+-----------+-----------+-----------+-----------+
| Argentina            | 0         | 7,506     | 3,253     | 3,000     |
+----------------------+-----------+-----------+-----------+-----------+
| **Total for Others** | 102,651   | 100,506   | 53,622    | 83,000    |
+----------------------+-----------+-----------+-----------+-----------+
| **Others not         | 5,321     | 12,424    | 4,854     | 0         |
| listed**             |           |           |           |           |
+----------------------+-----------+-----------+-----------+-----------+
| **Grand Total**      | **        | **        | *         | *         |
|                      | 107,972** | 114,000** | *58,476** | *83,000** |
+----------------------+-----------+-----------+-----------+-----------+