June 1, 2006

New Iraqi government to decide on future grain buys

The new Iraqi government headed by Nouri al-Maliki will set up a new committee to approve wheat and other commodities purchases, head of the Grain Board of Iraq Khalil Assi said Wednesday (May 31).

Assi did not say, however, when the committee will be set up but he said the board would then issue a new tender to buy wheat.

"We will issue a new tender as soon as a contract committee is set up by the cabinet," Assi said.

Earlier this month, Assi said the board had cancelled a tender to buy large quantities of wheat until the formation of a new government. The new cabinet was formed Jun 20.

Assi also confirmed the purchase of 350,000 tonnes of hard wheat from Australia.

"The Australians have agreed to the purchase and we have already opened a letter of credit," he said.

This backed up statements made by Wheat Australia Ltd that they finally reached an agreement to sell 350,000 tonnes of wheat to Iraq. The Grain Board of Iraq and Wheat Australia started negotiations over the sale in March, and the first shipment under the new contract is scheduled for June, according to Wheat Australia.

Wheat Australia, whose partners are ABB Grain Ltd, Grain Corp Ltd and unlisted Cooperative Bulk Handling Ltd, was formed early in 2006 after Iraq's refusal to deal with Australia's monopoly wheat exporter, AWB Ltd, over revelations that it paid kickbacks to the regime of Saddam Hussein.