Source: Google Maps
One of the interviewed farm managers witnessed the cultivation of Al-Dahra’s first season in May 2008. He explained with enthusiasm “our aim in Al Dahra is to manage our farms according to international standards, we have quickly gained a strong reputation in the Egyptian and international markets despite
the fact that we only started our operations in 2008”. For private investors,
considerations (Interview #19), prioritizing the highest economic return from the high value crops. For the company, an agricultural operation should mainly translate into financial return in foreign currency, function of demand and prices in the European export markets (Interview#18). The local market is of secondary importance, and mainly serves to sell the rejects (Grade B and C) of the export market. As proudly explained by the farm manager“Al Dahra received an award from the Netherlands in 2015, as Egypt’s top exporter of high quality oranges to the European market. Al Dahra’s agricultural produce is Global Gap certified, and we are currently working to be TESCO certified”.
In terms of the operational relationship between Al Dahra and ADFCA, (Interview #18) explains that Al Dahra Egypt sells its agricultural produce to Al Dahra Abu Dhabi, who in turn sells it to ADFCA. This transaction is subject to taxation from Egypt’s side, whereas the financial transaction ends up in the company’s account in Egypt. The company is subject to supervision by the Egyptian Import Export Authority (hay2at al saderat wal waredat), and each fiscal year has to be settled separately.
In each different geographic contexts of its four farmland, Al Dahra had to manage, adapt, resolve, and secure the necessary resources to ensure return on its agricultural investments. For example, in Al Nubareya farmland, Al Dahra acquires water from underground aquifers in the western desert, as well as the Nile through its complex irrigation network stretching downstream across the West of Delta agricultural area. In Toshka, Nile water is directly provided from Lake Nasser, supplemented by underground water from the great Nubian sand aquifer. In Sharq Al- Owainat, access to water for irrigation primarily depends on the great Nubian Sand aquifer, “by digging wells,
literally in the middle of the desert close to the Southern border with Sudan” (Interview #19).
In terms of land size, Al Nubareya and Al Salheya (Old-New Lands) are relatively much older, and much smaller in size compared to Toshka and Oweinat (New Lands) which are recently established land reclamation
schemes remotely located south west of Egypt near Lake Nasser and closer to the borders with Sudan (Interview #18). While farms in Old-New Lands are
limited in size, the location of Al Salheya and Al Nubareya provide several comparative advantages compared to remote desert lands. This includes easier access to electricity, better services, ease of transportation, and access to export ports from the Mediterranean or Red sea. These advantages contrast with remote sites in New Lands where distance to export ports implies
additional time and cost.
In terms of water resources, a major distinction between Egypt and other Nile basin countries, or elsewhere globally is that agriculture depends 100% on irrigation with no supplementary rainwater. It is crucial to understand this factor, given that securing water is a key element for a successful agricultural operation, and is therefore a major investment cost for farmland irrigation to achieve the corporate objective of maximizing agricultural productivity, and hence profit (Interview #19). For Al Dahra, a mix of Nile and underground water was adopted to develop large-scale land reclamation projects. In each of Al Dahra’s agricultural sites across the country both elements (land and
water) share some similarities, but often-different characteristics. Al Salheya farmland eastern of Nile Delta depends on Nile water from Al Ismailia Canal. Irrigation in Al Nubareya farmland west of Nile delta depends on a mix of water sources, originally from underground water, supplemented by Nile water, which only started to flow to Al Dahra’s farms in 2014, conveyed through Al Nasr Canal, one of two major branch canals from Al Nubareya Canal. Al Dahra’s large-scale schemes in Toshka depend on the Nile water from Lake Nasser channeled through al Sheikh Zayed Canal, mainly
characterized by high water quality. While Al Dahra’s investments in Sharq Al Oweinat 60 km from the border with Sudan solely depend on underground reserves from the trans-boundary Great Nubian Sand Aquifer, shared between Egypt, Sudan, Libya and Tchad.
However According to the company’s management, “despite the land-water resources potential, do not make profit due to the high level of transaction costs associated with this operation from cultivation to export” (Interview #18). As such, between the Nile surface water and its complex irrigation network on the one hand, and underground water resources in Egypt’s desert
on the other, investors face several paradoxes pertaining to issues such as – but not limited to- water quality and quantity, access to electricity, and logistics amongst other factors. In this respect, different modalities of agricultural investments in both Old-New Lands and New Lands enrich our perspective about the company’s practices and challenges, especially as it relates to its diverse land and water acquisitions across the country and the Nile’s watershed.
Table 5.1: SUMMARY AL DAHRA LAND-WATER INVESTMENTS in Egypt Al Nubareya
(West of Delta) Al Salheya (East of Delta) Toshka Sharq Al Owainat Land Size 360 Feddans 3,200 Feddans
40 years lease 100,000 Feddans / Only 20,000 cultivated 500 million USD
16,000 Feddans Crops Citrus – Oranges,
grapes, mango, and other fruits for export markets
1,475 Feddan Citrus (Orange Naval 130 feddan & Orange Valencia 1175 feddan) + 1,725 feddan cultivated out of which 1,200 feddan of wheat and the remaining 525 divided amongst sweet corn for silage, potatoes, and winter weed.
Wheat /alfa alfa Wheat/alfa alfa
Source of
Water Underground Water – Nile water only started in 2014
Al Nubareya/Al Nasr Canal –Al Khereegen Secondary Canal – Branch Canal 4
Nile Water
Al Ismailia Canal Primary – Tarouty Secondary Canal – Al Kassara Tertiary Canal + 17 unused wells
Nile Water – Directly from Lake Nasser via Al Sheikh Zayed Canal Supplemented by Underground water Undergroun d Water – Great Nubian Sand Aquifer Water Pump 30 horsepower pump 28 pumps -
Station 1: 11 pumps – Station 2: 9 pumps – Station 3: 8 pumps 100 horsepower pump / 2008 Grundfos German Technology Source of
Electricity Grid Grid Grid – inconsistent – Plans to expand to solar
Grid Inconsistent Irrigation
System Double Drip Centre Pivot, Double Drip, Sprinkler/ Upgraded in 2012 2015 Centre Pivot Centre Pivot Types of
Crops Fruits/Citrus Fruits/Citrus, Alfa Alfa, Wheat, Alfa Alfa, Wheat Alfa Alfa, Wheat Destination European Market Depends on the product
:Europe/UAE/Egypt/ Egypt, UAE, other Egypt, UAE, other Labor 12 (fixed) +outsource
labor via external contractor for cultivation season / average 2 per feddan of citrus
82 – 130
(Source: Author)
5.4.2. Challenges of Land Deals in New Lands
Al Dahra’s largest investments under the category of New Lands are located in Toshka, and East Oweinat, Both farmlands -150 km from each other- are remotely located in the western desert where there are no land holdings for small farmers. In East Oweinat, the 15,000-feddan farmland was directly leased from the Ministry of Agriculture who had failed to develop the land on
its own (Interview #18). In this farmland, the company produces about 50,000 tons of forage and silage per annum, in addition to owning and operating a forage processing and baling facility. In addition, the company cultivates wheat solely depending on underground water, with a target production of 100,000 tons per year (Interview #19).