June 10, 2009

Moscow and Cairo have agreed not to allow trading intermediaries to sell Russian grain to Egypt after an investigation blamed them for a recent seizure of grain on safety grounds, Russia's agriculture ministry said Tuesday (June 9).

In a statement the ministry quoted Sergey Dankvert, head of the Russian federal food quality watchdog Rosselkhoznadzor, as saying that the Russia-Egypt intergovernmental commission agreed June 3 that from now on the Russian grain supplied to Egypt should only be accompanied by quality certificates issued by Rosselkhoznadzor and not by independent surveyors.

Dankvert said the examination of the Russian grain seized by the Egyptian authorities on safety concerns had revealed that there was a disagreement between the quality certificates originally issued by Rosselkhoznadzor, and the certificates issued for the same grain by independent surveyors, which later accompanied the grain to Egypt.

The discrepancies especially concerned protein and moisture content.

Dankvert said the Egyptian authorities had no complaints about Rosselkhoznadzor, but the problem was with the grain trading intermediaries which purchased feed grain in Russia and then tried to sell it to Egyptian clients as milling grain.

Danvert said: "We aim to ensure that the exported grain should be accompanied by quality certificates issued by the state and not by independent surveyors. The state and the intermediaries have different aims. The speculators want to buy the grain as cheap as possible and to sell it at the highest possible price, while the state strives to strengthen its reputation on the international market."

A 52,000-tonne shipment of Russian wheat being delivered to Egypt's state-owned General Authority for Supply Commodities, or GASC, has been seized by Egyptian authorities on health concerns at the port of Safaga. There are also reports that two further ships carrying Russian grain have been quarantined by Egyptian inspectors.