In the first 10 days of September agrarian market was shocked with the information that Egypt would refuse imports of Ukrainian wheat. The news had evoked such a massive outcry that not only traders and analytical agencies were provoked to react, but official bodies as well.
The news that Russia and Ukraine were enrolled on the list of ergot wheat suppliers had been announced by the member of a special committee, established by Egyptian AgMin – Ashraf Halil. Along with this, late in August Egypt introduced zero tolerance requirement to the ergot content in the imported wheat.
Ministry of Agrarian policy with reference to State consumer committee anounced that they did not receive any official notifications from Egypt refusing imports of Ukrainian wheat.
Though, the situation got acute due to the information that Egypt rejected some cargoes of Ukrainian wheat, supplied according to the earlier concluded contracts with content of ergot lower than 0.05%.
Late in August GASC published the list of countries, which supply wheat with ergot traces. Almost all the traditional wheat suppliers were included in this list, except for Russia, Ukraine and Lithuania. Afterwards, Russia and Ukraine were added as well, which left no chances for Egypt to buy wheat elsewhere.
Russian exporters’ reaction was quite strict – not a single wheat cargo has been shipped to Egypt since the start of September. Romanian trader asked to return $500,000 of the guarantee payment, as it was not able to supply ergot-free wheat. Ukraine has shipped 40 KMT since the start of September and is preparing another 60 KMT of wheat for shipment.
Traders comment in this way: “We load the clean one. Purchasing wheat on domestic market we initially state the requirement of zero ergot. And the supply is enough. Due to the presence of GASC representative during the loading we expect there should be no problem”.
Forecasting the further prospects of wheat exports to Egypt, market operators are unanimous: when the prices begin to go up, Egypt will forget its excessive requirements. It is likely that Russian threats to close its market for Egyptian oranges will speed up the process. (UkrAgroConsult/Business World Magazine)
