As analytic center Sovekon reported on Wednesday June 7th, in June-July Egypt may completely stop buying Russian wheat.
It will happen due to Cairo’s requirement to reduce the ergot content in the grain to zero, which in practice is not feasible, analysts say. They emphasize that stopping shipments to Egypt will adversely affect Russian overseas shipments and export prices.
The requirement for the zero content of ergot can come into force after June 13th. Analysts note that the court decision jeopardizes the fulfillment of contracts with the Egyptian state-owned company GASC, which in recent weeks has purchased 480 thousand tons of wheat for delivery in June-July, of which 180 thousand tons were from Russia.
Ergot is a parasitic fungus that affects some grains, and international standards allow its content in the grain up to 0.05%. In September 2016 Cairo canceled the requirement for zero ergot content in imported wheat.
Egypt is the largest buyer of Russian wheat. Deliveries to this country last year reached 5.7 million tons, accounting for more than half of Egyptian imports.