By John Helmer in Moscow
The president of the Russian grain exporters’ association went on the offensive against Egypt today, charging the Egyptian government has so far failed to report any findings, or lodge any claims, against Russian wheat imports. According to Egyptian media reports, 137,000 tonnes of Russian grain cargoes have been detained from three shipments since May 13. The volume represents about 4.5% of this year’s estimated deliveries from Russia to Egypt of 3 million tonnes. GASC, the Egyptian state buyer and distributor of grain, and two commercial traders, Union Trade and Horus, have been identified as the consignees, according to Russian reports.
Russia provides roughly one-quarter of Egypt’s import requirement, more than double the next largest exporter, India. The cargo arrest orders appear to have been signed by the Egyptian Public Porsecutor’s Office, alleging infringement of the sanitary norms in the cargo contracts. The halt to the trade in the world’s largest-volume importer of wheat appears to have triggered a 4% increase in wheat futures trading in the US commodity market this week.
Arkady Zlochevsky, head of the Russian Grain Union, said that certificates of quality for Russian grain exports are routinely issued by the government’s farm product inspectorate, Rosselkhoznador, while sanitary checks and warranties are issued by international surveyors. Fumigation in ship holds then follows. According to Zlochevsky, allegations of infestation in cargoes that have arrived in the past week at the Egyptian ports of Safaga and Damietta are not official, but have been leaked to the press. Novorossiysk was the port of origin, he said. Novorossiysk port is reporting that the volume of its grain shipments in the four months of the year to April 30 is 3 million tonnes, a fourfold jump over the same period of 2008.
As of one hour ago, Rosselkhoznador has received no Egyptian complaint or cargo claim, Zlochevsky added. “No matter what is written in press,” he told Fairplay, “we have not received a single officially drafted claim. ” Neither the Egyptian Embassy in Moscow, nor GASC, the state wheat buyer, is speaking to the press.
According to Zlochevsky, “what the media are reporting indicates that the cargo claims have occurred after unloading at the ports. During the acceptance procedures in the Egyptian ports, where there were representatives of the survey organizations and the consignees, there was nothing wrong.”
Zlochevsky and Russian industry analysts believe that either Egyptian traders are trying to press the Russians into lowering their grain price. Or else, there is a government-led scheme in Cairo to reduce imports in favour of domestically grown grain, and reallocate shares of the import market to lessen the Russian share.
Egypt’s Foreign Minister, Ahmed Aboul Gheit, had been expected to arrive in Moscow on Monday, May 18, but he arrived two days’ late. He met with Russian Foreign Minister Sergei Lavrov this morning, but there has been no communique or press leak so far to suggest that the conflict over grain sales was discussed.
A World Grain summit is planned for St. Petersburg on June 6.