August 10, 2010
Suppliers cancel Bangladesh wheat deals
Following Russia's ban on grain exports last week, global suppliers cancelled deals to ship as much as 200,000 tonnes of Black Sea wheat to Bangladesh, a food agency official and two private traders said on Monday (Aug 9).
"Two global suppliers cancelled deals with us for Black Sea origin wheat," said the food agency official, who declined to be named.
Of the total, the agency was to receive 100,000 tonnes while private importers were to get the remainder.
Bangladesh's wheat imports are likely to drop to around 2.5-3 million tonnes this fiscal year to June 2011, following a ban on shipments from Russia and lower output in Ukraine and Kazakhstan. The country mainly buys Black Sea wheat and smaller quantities of high-quality Australian and Canadian cargoes for blending.
"Suddenly we are affected by the decision," the food agency official said. "Now we're not in a position to sign deals with the government."
Wheat was sold to Bangladesh's government-run food importer in two separate tenders of 50,000 tonnes each. In one tender the lowest offer was US$241 per tonne including cost and freight (C&F), and US$221 per tonne C&F in the other.
By comparison, Black Sea wheat was around US$270-US$290 a tonne C&F Southeast Asia as of last week, traders said.
Bangladesh purchased 3.5-3.7 million tonnes of wheat in the fiscal year that ended in June 2010, mainly because of cheaper prices. It usually buys 2.2-2.5 million tonnes of wheat annually to meet its demand.
The nation's effort to build an emergency food stockpile would not be hit by the export ban because the government is importing rice as well and rice prices are currently stable, a trader said.
India has allowed exports of 300,000 tonnes of non-basmati rice and 200,000 tonnes of wheat to Bangladesh, an Indian government statement said on Friday (Aug 6).
The government will try and buy more grains through diplomatic channels after the Russian ban, an official of the state grains buyer said.
