Egypt Snubs Russia Again and Buys Wheat from the US, France and Ukraine.

Feb 8, 10:56 am | AgResource Plus | Share this:

Summary: Today, Egypt’s GASC purchased 300,000 MT of wheat from the US, France and Ukraine (for delivery in late-March).  This is the second tender in a row that Russia has failed to sell wheat to GASC.  This is GASC’s second purchase of French wheat since July 2017.  The last time GASC fought wheat from the US was Nov 22, 2018.  Today’s lowest CIF was US SRW at $260 – – even though US freight is nearly double the cost of freight from Black Sea origins.  The average CIF price that Egypt paid for the wheat was $260.58/MT.  That is $2.22/MT below the price paid Jan 29.  Five months ago, Egypt purchased wheat at $235/MT (CIF).  On a FOB basis, today’s average price accepted was $241.17, which is $8.21 below the price paid on Jan 29.   In the Dec WASDE, USDA left its projection for Egypt’s 2018/19  imports unchanged at a record 12.5 MMT, up 100,000 MT from last year.  In mid-January, GASC was able to obtain financing that allowed it to make payment “on sight” rather than within 180 days.  Traders estimate that the change in payment terms reduced sellers costs by $5-6/MT.

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After purchasing 360,000 MT of French and Romanian wheat on Jan 29, today, Egypt’s GASC bought 300,000 MT  from  the US, France and Ukraine.  No wheat was purchased from Russia   We estimate that the average FOB price paid in the tender was $241.17/MT, down $8.21/MT from the price paid at the last tender (see chart below).  A month ago, GASC paid the highest average FOB price accepted in 4  years.

 

 

We estimate that the average cost of freight was $19.41/MT, $5.99/MT more than the previous tender (see chart below).

 

 

We estimate that the average total CIF price paid at this tender was $260.58/MT, $2.22/MT less than the price paid at the last tender (see chart below).