April 4, 2012

 

 

Oil World said on Tuesday (Apr 3) that because of the sanctions imposed to Iran over its disputed nuclear programme by the US and EU, the country's imports of soy, soymeal and soyoil are being sharply reduced.

 

"Imports of oilseeds and products are severely affected by the financial sanctions as private importers are currently unable to obtain letters of credit," Oil World said.

 

"State buyers have reportedly stepped in to secure grain supplies but imports of oilseeds, oils and meals are declining far below requirements in the current quarter."

 

Oil World estimates Iran's October 2011/March 2012 soy imports were only 70,000 tonnes, just one-third of the imports in the same year-ago period.

 

Soymeal imports in January/March 2012 were "almost coming to a standstill" following imports of 0.49 million tonnes in the same time in 2011, it said.

 

Iran's recent soymeal purchases from India were made at price premiums well over South American supplies, Oil World said.

 

Traders said on March 20 that Indian dealers had sold up to 150,000 tonnes of soymeal to Iran and about 100,000 tonnes could be sold in coming weeks.

 

"Soyoil imports from South America are virtually coming to a halt this quarter against 175,000 tonnes imported a year ago," Oil World added.

 

Iran has been making heavy purchases of wheat via its state purchasing agency GTC with some payments said to have been routed via Turkey. But Iran's private-sector wheat importers have had a more difficult time, with cash payment in advance demanded for recent private wheat purchases from Kazakhstan.

 

Western sanctions do not cover Iran's food imports but the disruption to the Iranian banking system means the country is having problems making payments for food purchases.

 

"Domestic consumption of oils and fats is likely to be severely affected by the sanctions unless importers manage to find replacement (supplies), for example via re-exports from neighbouring countries and/or third party financing," Oil World said.