July 14, 2011

Egypt may add Ukraine, Romania to list of wheat suppliers

Egypt is considering adding Romania and Ukraine to its list of approved wheat suppliers, in an effort to diversify its range of sources.

Egypt, the world's biggest wheat importer, buys 5-6 million metric tonnes of the grain a year via international tenders because local production is too low to meet demand in the Arab world's most populous nation, said Nomani Nomani, vice chairman of the state-run General Authority for Supply Commodities.

"We are still studying the possibility of adding the Romanian and the Ukrainian source to our list," Nomani said. "This will depend on several factors, including the quality of the crop and their ability to export, especially in the long-run."

When Russia halted grain exports in mid-August as the country suffered the worst drought in a half century, Egypt's General Authority for Supply Commodities (GASC) dropped it from the list of approved sources for wheat imports and bought subsitute supplies from countries including France and the US. Egypt reinstated Russia after the country's export ban expired on July 1 and bought 180,000 tons of Russian grain, GASC said July 7.

Nomani said he will visit Russia July 18-22 as part of a delegation to meet with government officials and private grain traders for discussions on regulations governing wheat shipments.

"The objective of the meeting is to emphasize the specifications of the wheat sought and ensure that the quality is good," Nomani said. "We want to make sure that what happened in August will not be repeated."

The delegation will also ask whether Russia is prepared to increase the number of ports from which the grain is exported to Egypt, Nomani said. Novorossiysk on the Black Sea is the only port used for the trade now, he said.

Egypt, which has a population of about 80 million people, uses imported wheat to make subsidized bread.