Concern rises over Egypt delaying wheat payment guarantees
The world’s largest wheat buyer sows confusion among suppliers
Cairo/Dubai — Egypt, the world’s largest wheat buyer, has not issued letters of credit covering 16 recently purchased cargoes, effectively delaying payment and sowing confusion among suppliers, sources familiar with the matter say. In previous years, acute shortages of foreign currency have caused delays but Egypt’s net foreign reserves registered $44.513bn at the end of November, a figure estimated to cover around nine months of imports. “This kind of delay is not unheard of and there have been incidents before, but the difference this time is two things. First of all it is a large amount of wheat, three shipment periods. Secondly, they felt the need to tell some suppliers that the letters will not be issued until January, that is what is causing some concern,” one Cairo-based trader said. Cairo, which prioritises spending on its massive wheat import programme, pays around $1.5bn annually for the grain as part of a bread subsidy programme relied on by tens of millions of Egyptians ...
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