Egypt fails to buy half a million tons of wheat from Russia

Egypt will buy 480,000 tons of wheat from France and Bulgaria instead of the promised supply of grain from Russia, reports Bloomberg with reference to its sources.

The agreement to supply a batch of wheat to Egypt was blocked in Russia, the news agency clarifies.

At the beginning of September, the Egyptian state grain trader Solaris, as part of a private agreement, agreed to buy 480,000 tons of wheat from the Russian Federation at a favorable price of $270 per ton on FOB terms. That is, the seller opened access to the goods for the buyer at the factory, warehouse or firm, and the buyer picked up and transported it himself.

This price is lower than the informal minimum price set by the Russian authorities.

Russian grain ports are overflowing after two record harvests in a row. However, oversupply is putting pressure on local prices, prompting officials to set a price floor to prop up the market. The application of this price limit was inconsistent, Bloomberg notes.

After the start of the full-scale war, Egypt was forced to stop importing Ukrainian wheat, but the grain initiative allowed to resume purchases from December 2022.

Domestic consumption of wheat in Egypt is about 25 million tons per year, while the country produces almost 12 million tons. It has to import the rest.

In August 2023, India was negotiating with Russia to import wheat at a discount.