Iraq excludes US wheat from supply tender
Hamburg, January 29, 2012
The Iraqi Grain Board has issued an international tender to purchase at least 50,000 tonnes of wheat from any origin excluding the United States and Romania, European traders said.
Shipment dates were not given. Bidding deadline was February 5 and offers must remain valid until February 9.
"We are surprised that the Iraqis have decided to reduce their potential wheat sources in the current tight global wheat market," one European trader said. "With the United States ending its presence in Iraq it is hard to judge whether there is a political factor here."
Another exporter said: "There is market talk that an Iraqi provincial mill had complained to the ministry in Baghdad that a previous purchase of U.S. wheat was unsuitable for Iraqi flour."
"It seems to have escalated into the U.S. being excluded from the current tender. But the Iraqis have taken a lot of U.S.
wheat without problems in the past and I do not think it will be a long-term issue."
There was also trade talk that U.S. authorities were working to reverse the decision to exclude U.S wheat.
Government offices in Iraq are closed on Friday for the Islamic weekend.
Global grain prices were supported by talk this week that Russia may curb grain exports because of falling inventories after a massive flow of overseas sales in past months.
Drought in Argentina is also making the country's exporters less willing to sell.
"There is currently strong demand on international grains markets meeting a lack of liquidity in cash markets with tighter supplies in Russia while Argentina is suddenly out of the wheat export market because of uncertainty about exports after its drought," another trader said.
"With Iraq, Jordan and Ethiopia currently tendering you could be talking easily about up to 400,000 tonnes to 500,000 tonnes being bought in the next couple of weeks," he added.-Reuters