Iraq Makes First Purchase of U.S. Rice under the U.S.-Iraq Memorandum of Understanding
May 19, 2017, 09:40:00 AM EDT By Reuters
HAMBURG, May 19 (Reuters) - Iraq's state grains buyer remains in talks about buying around 100,000 tonnes of rice to be sourced from the United States, with no purchase yet made, European traders said on Friday. Offers were submitted on May 15 and must remain valid until May 21, they said. [nL8N1ID372] Traders said the trade ministry in Iraq, a major global buyer of wheat and rice, had sent out price inquiries to trading houses about buying the rice rather than issuing a formal international tender. Only two offers were made for nearby prompt shipment, they said. One U.S.-based multinational trading house offered $587 c&f for 100,000 tonnes and a Middle Eastern trading company offered 40,000 to 60,000 at $595 a tonne c&f. "Iraq normally says a minimum of three offers should be made for grains and rice purchases so a cancellation is expected, but it is not clear if this is a formal tender," one European trader said. "The rather tight supplies of U.S. rice available for shipment up to the end of June make this sale anyway difficult for exporters." Iraq's cabinet authorised the trade ministry on May 9 to make direct purchases of wheat and rice to guarantee food security. [nL8N1IB6YY] Baghdad has been struggling to import grains and rice for its food subsidy programme after introducing new payment and quality terms which left trading houses unwilling to participate in its international tenders. Iraq told suppliers earlier this year it would pay for its grain in instalments. Traders said they were informed by Iraq's Grain Board that low oil prices and other financial factors were forcing the country to delay payments. [nL3N1H64NC]
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