Egypt Weighs 20% Gas Cut for Fertilizer Plants in Proposed Austerity Package
Key Facts
The Egyptian government is weighing a 20% cut in natural gas supplies to fertilizer plants while considering higher gas prices for factories, as part of a proposed package to reduce spending and curb consumption, a senior Finance Ministry official told Al-Manassa on November 3, 2026. The proposed price increase is still under consideration, while gas allocations to fertilizer plants began to be cut at noon on November 1. Kima said its urea plant continued operating normally as it assesses the impact of the cut. Mopco said its operational and production activities continued without interruption, and that it was managing operating rates according to available gas volumes. This puts the proposed fiscal measures and the supply cuts on parallel tracks, with an immediate impact on some companies and shares.
The official said the finance and planning ministries had drafted austerity measures and intended to present them to the cabinet during its meeting that same week. Alongside consideration of higher gas prices for factories and lower consumption, the package includes boosting strategic reserves of basic commodities. The report did not specify when a final decision on gas prices would be made or detail how the other measures would be implemented. In the fertilizer sector, gas allocations were cut by 20% at noon on Sunday, November 1, according to Masrawy. The start of the supply cuts makes this step separate from the proposed price increase, which remains under government consideration.
The effects of the supply cuts are evident at at least one facility: Al-Manassa reported that the operating capacity of one of the three facilities owned by a state-run fertilizer company had fallen to less than 40%. That figure does not mean the company’s overall operating capacity has declined, but it points to acute pressure on the affected facility. Kima, by contrast, said its urea plant continued operating normally and that the company was assessing the decision’s implications. Mopco confirmed that operations and production continued without interruption, with operating rates adjusted according to available gas. These statements highlight differences in the impact of the cuts across companies and facilities so far, with sources reporting no full-scale production stoppage.
The move comes as the World Bank expects energy prices to rise 32% and fertilizer prices 14% during 2026. The bank also forecast that overall commodity prices would rise 23% in 2026 before falling 7% in 2027, assuming no major escalation in conflicts affecting global commodity supplies. Those estimates provide a challenging backdrop for a sector that relies on gas for production, while sources gave no figure for Egypt’s energy import bill and did not directly link the price forecasts to the government decision. Earlier, in May 2026, Egypt raised gas prices for several energy-intensive industries; Reuters reported prices of $14 per million British thermal units for cement, $7.75 for iron and steel, non-nitrogenous fertilizers and petrochemicals, and $6.50 to $6.75 for other industrial activities. The government also raised domestic fuel prices by as much as 17% in March 2026, Reuters reported.
The news was reflected in trading in sector stocks during the middle of the November 3 session: Abu Qir Fertilizers fell 3.76%, Kima 1.92% and Sidi Kerir Petrochemicals 0.82%. Misr Chemical Industries bucked the trend, rising 0.15%, according to data reported by Al-Manassa. The moves coincided with the start of gas cuts and reports of a proposed price increase, but sources did not break down the effect of each factor. In earlier regulatory context, the agriculture and petroleum ministries said in August that the annual subsidized fertilizer allocation remained at 2.4 million tons, and the petroleum ministry said at the time that it was providing factories with the required gas volumes. That statement came before the supply cuts that began in November.