December 26, 2003

Egypt To Buy 200,000 MT Syrian Wheat

The General Authority for Supply Commodities (GASC), Eygpt's main state wheat buyer announced the signing of a memorandum of understanding to receive 200,000 metric tons of Syrian soft wheat in the first quarter of 2004.

Nomani Nomani, GASC's general manager, told OsterDowJones that the 200,000 tons of Syrian wheat is part of a larger barter protocol signed with Syria's state-run General Establishment for Cereal Processing and Trade, or Hoboob, in November to import about 500,000 metric tons of wheat annually for a period of two years in exchange for cement and rice.

He said that GASC had signed an identical agreement in November to secure a previous 200,000 tons of Syrian wheat for 2004 delivery. That agreement was also part of the larger barter protocol signed on Nov. 11 with Hoboob.

No one was immediately available for comment at Hoboob.

The total amount of wheat Syria gives to Egypt under the barter deal will depend on its harvests while Egypt for its part will supply Syria with 85,000 tons of cement and 24,000 tons of rice annually it was reported at the time of the deal by the state-owned local press.

Under the barter deal, Syria will also supply Egypt with 30,000 tons of lentils annually during the two year period.

GASC's Vice Chairman Mahmoud Abdelhamid is currently in Syria as part of an official Egyptian delegation. It's not immediately clear when GASC signed the memorandum with Hoboob.

Syria had been listed in GASC tenders this year as one of the potential origins. But that stopped once the barter deal with Syria was struck in November and no Syrian wheat was ever purchased through a tender.

The International Grains Council in its latest report pegged Syria's exportable surplus for 2003-04 at 500,000 tons. However, the U.S. Department of Agricultural put Syria's forecast wheat stock this year at 4.5 million tons, with some 800,000 tons for possible export.

Egypt is forecast to import 6.5 million tons of wheat during the 2003-04 marketing year, according to the latest report from the International Grains Council. GASC purchases account for the bulk of Egypt's imports.