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Russian wheat retains lead as Egypt trims wheat imports

Egypt’s imports of Russian wheat rose 84% in March-May from the same period last year, freight data showed, even though traders said there were some complications around payment and shipping.

Egypt, one of the world’s top wheat importers, has become heavily reliant on Russian and Ukrainian grain in recent years.

Egypt’s imports of wheat, some for state subsidised bread, were put in doubt by Russia’s invasion of Ukraine on Feb. 24.

In March-May this year, as imports from Ukraine ground to a halt, Egypt imported 1,056,290 tonnes of wheat from Russia, compared to 573,213 tonnes over the same three months in 2021, the freight data showed.

Over the January-May period Egypt’s total wheat imports dipped 24% year on year to 3.3 million tonnes, and those from Russia by 30% to 1.66 million tonnes. But wheat imports from Russia still accounted for just over 50% of the total.

The private sector and Egypt’s state grains buyer, the General Authority for Supply Commodities (GASC), have tried to diversify their sourcing of wheat this year as prices have risen.

Most imports of Russian wheat have come through the private sector, with traders saying Russian grain was cheapest, while French, German and Lithuanian wheat was more expensive.

Russia has faced Ukrainian accusations – which Moscow denies – that it has stolen Ukrainian wheat. Ukraine thanked Egypt in May for sending back a cargo Kyiv said was stolen and which Cairo said lacked proper paperwork.

Some Egyptian banks refused to facilitate payments to Russian entities because of Western sanctions but three traders said importers had made some purchases via suppliers in third countries including the United Arab Emirates and Switzerland.

One of the traders, all of whom asked not to be named, said banks still required extra paperwork if the cargo was Russian.

“Egypt is still price-oriented. They look at it from an economic point of view. No one cares about the politics of it,” said a trader.

GASC has continued purchasing Russian wheat but faced challenges finding freight offers to transport it in its last tender this month, four traders told Reuters.

Egypt’s National Navigation Company (NNC) usually submits offers to transport Russian wheat but did not do so in GASC’s last tender. Instead, GASC asked suppliers to provide shipping.

Last month, Egypt approved wheat shipped from an additional Russian port, Kavkaz, according to a document seen by Reuters and a person with knowledge of the matter.

Traders said GASC suppliers could not previously use the port because of logistical challenges. They said approving Kavkaz could mean more competitive shipping offers.

The supply ministry did not respond to a request for comment. Traders said GASC had yet to inform them of the decision on the new port approval.
Source: Reuters (Reporting by Sarah El Safty; Editing by Aidan Lewis and Edmund Blair)

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