Egypt to send team to Russia as export tensions increase: Ministry

Egypt will be sending a team to Russia at the end of September to discuss a ban placed on Egyptian agricultural exports, the Ministry of Trade said in a statement Saturday. A move comes amid growing tensions over Egypt’s wheat restrictions.

Russia said on Friday it would temporarily suspend imports of fruit and vegetables from Egypt starting Sept. 22. The announcement came shortly after Cairo formally rejected a Russian wheat shipment due to finding trace levels of the common grains fungus ergot.

Russia said last week it was seeking talks with Egypt, its top wheat buyer, over Cairo’s failure to approve any Russian wheat shipments since tightening its regulations on ergot last month.

Egypt reinstated a zero tolerance policy on ergot and applied it retroactively to all outstanding contracts, a move that has infuriated traders who boycotted the state’s grain tender on Friday in protest.

Ergot is a common grains fungus that can cause hallucinations when consumed in large amounts but which is considered harmless in low quantities. Most countries permit shipments with up to 0.05 percent.

Moscow has a history of using threats and limiting imports in trade disputes, but Cairo’s policy over the ergot fungus has created a headache for all of Egypt’s wheat suppliers, who say guaranteeing zero ergot in shipments is impossible.

Russia is one of Egypt’s top export markets for fruit. The North African country sold some $350 million in agricultural commodities last year to Russia, including 400,000 tonnes of oranges, or 30 percent of its total orange exports, the trade ministry statement said.

Egypt’s prime minister held an urgent meeting on Saturday with the ministers of supply, agriculture, health, and trade, to discuss the outstanding wheat shipments affected by the new ergot policy, a cabinet statement said.

Traders said they expected a decision this week that may allow stranded wheat shipments contracted for under the country’s old ergot regulations to be shipped to Egypt.

Source: Reuters