April 19, 2006

 

Iraq finalises Australian, German wheat deals

 

 

The Grain Board of Iraq has finalised two purchases of wheat from Australian suppliers outside Australia's AWB Ltd and from Germany, the head of the board said Tuesday (Apr 18).

 

Khalil Assi, head of the Grain Board of Iraq, said Australian suppliers had reduced the wheat purchase to 350,000 tonnes instead of the 500,000 tonnes that Iraq had earlier wanted to buy.

 

"We have already bought the 350,000 tonnes and we opened a letter of credit for it," Assi said.

 

Asked why the amount was reduced, he said: "The Australian suppliers asked for that reduction, not us."

 

The Australian purchase was priced at US$190 a tonne, he added.

 

In March, Assi said the board was waiting for Australian suppliers to sign a copy of a contract that was signed by the board to buy 500,000 tonnes of Australian wheat.

 

This is the first purchase in months since Baghdad suspended its ties with Australia's monopoly wheat exporter AWB over allegations that it paid kickbacks to Saddam Hussein's regime under the oil-for-food deal with the UN.

 

Assi also said the board finalised its purchase from Germany of 150,000 tonnes of wheat at US$180/tonne. He gave no further details.

 

Iraq's wheat purchases in 2006 have totalled 1,450 million tonnes. Earlier 500,000 tonnes were purchased from Canada and 450,000 tonnes from the US.

 

Suppliers outside AWB recently set up a new company called Wheat Australia Ltd to undertake wheat exports to Iraq.

 

Wheat Australia is a consortium comprising GrainCorp Ltd, ABB Grain Ltd, and unlisted Cooperative Bulk Handling Ltd.