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The Daily Star: Wheat market boycott forces Egypt to loosen import rules

Egypt is under huge presssure as it had to cancel one tender after the other as traders refuse to comply with Egypt's 0 tolerance for ergot.
22.09.16 | Interesting article at The Daily Star

After three failed attempts to buy wheat, Egypt is under pressure to loosen its rules for grain imports or face an extended boycott from international traders. Egypt’s state-run buyer had to cancel a tender Monday as trading firms refused to participate after the country reinstated a ban on a common type of fungus known as Ergot and rejected cargoes. Authorities are now reviewing their policy on Ergot in wheat shipments, according to a government official, who asked not to be identified because talks are private.

“They will probably return to the terms that existed before,” said Vadim Sarkisov, director of Russia’s largest grain exporter OOO Trading House RIF, by phone from Rostov-on-Don.

Egypt is closely watched by the grain market because it buys more wheat than any other country to supply a subsidized bread program. Officials have gone back and forth with regulations over Ergot this year, sowing confusion in the market and leading to fewer offers and higher prices at the tenders.

The canceled tender was for shipment between Oct. 16 and 26. Egypt, which checks every cargo it buys at loading ports, has stockpiles to meet demand for more than six months, the Supply Ministry said Aug. 31.