Oct. 31 (Bloomberg) -- Ukraine should be able to offer a better price for milling wheat than Russia in North African and Middle Eastern markets after it won a tender in Egypt on Oct. 29, according to UkrAgroConsult.
Egypt, the world’s biggest wheat importer, bought 120,000 metric tons of Ukrainian wheat, half from Toepfer International at $247.92 a ton and half from Venus International at $249.30 a ton. Ukrainian wheat was $8 a ton less than the lowest Russian offer, the Kiev-based researcher said today by e-mail.
“We will be competing with Russia all the time on the Egypt market now,” Liza Malyshko, an analyst at UkrAgroConsult, said by phone today. ’’I think Ukraine will be able to sustain a lower price in this market. A lot will depend on the domestic price. Internal prices in Russia have started to increase and we see that this trend is starting here.’’
Ukrainian authorities scrapped a 9 percent export tax for wheat, which came into force on July 1, from Oct. 22. The government expects Ukraine’s grain harvest to increase by 35 percent to 53 million tons this year, helped by favorable weather. The Agriculture Ministry expects 27 million tons of grain to be shipped this year, Mykola Prysyazhnyuk, the minister, said on Oct. 19.
Buyers’ interest in Ukrainian wheat and the number of traders at tenders suggest that exporters will buy in the domestic market and that the price for milling wheat will gradually increase, according to the researcher.
Wheat prices are not seen declining in Russia nor in Ukraine until the status of the 2012 harvest is known, according to Malyshko.
--With assistance from Ola Galal in Cairo. Editors: Sharon Lindores, John Deane
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