Grain exporters suspend contracts with Turkey for fear of restrictions
MOSCOW. Nov 26 (Interfax) - Russian grain exporters suspended contracts concluded for grain deliveries to Turkey due to fear of restrictive measures and they are shipping only that grain which has already been paid for, a grain trading company representative told Interfax.
"In the face of uncertainty and measures adopted in related markets, nobody is conducting new sales. No one will risk it. Now the main task is to ship what we have already sold," he said.
Grain has already been sold for December and partly, for the first half of January. However various documents are yet to be signed for those shipments, including phytosanitary certificates.
"I hope that no hasty steps will be made in this market and there will be no restrictions on contracts that were already concluded," he said.
As a source in another company said, grain deliveries to Turkey are especially important for the Azov terminal. Businesses need to be warned in advance about all possible restrictive measures.
As the Director for the Institute for Agricultural Market Studies, Dmitry Rylko said, if there will be bans introduced in relation to Turkey, then there will be problems for two large Russian markets: grain and sunflower seed oil.
Redirecting Turkish sunflower seed oil, for example, to other markets is difficult, because we have two major customers, that is Turkey and Egypt. And they account for nearly half of exports," he said.
In terms of possible sales of Russian grain, intended for Turkey on other markets, Rylko said that it will be difficult to do that. "This grain would be rough to sell in other markets first of all because of its specific qualities," he said. Turkey buys especially high quality wheat from us, and these amounts will be different to redirect to other countries, he said.
He said that the market for this grain is not very big. As a result, if the situation gets difficult, grain producers could in the Rostov and Voronezh regions who are oriented at offloading through the Azov terminal, could refuse.
According to Rusagrotrans information, starting July until October this year, Turkey was second in Russian grain purchases behind Egypt. It imported 1.603 million tonnes of wheat, and exports to Turkey accounted for 12% of overall export volumes.
