pakistan-iran-wheat-600

File photo

ISLAMABAD: Pakistani grain exporter Seatrade Group said it will start shipping 100,000 tons of wheat to Iran by the end of January or early February, one-tenth of the original tender agreed in August.

Iranian wheat imports are usually handled by the private sector but the Iranian government had to step in and help with purchasing this year because of the disruption to trade financing caused by Western sanctions aimed at Iran's disputed nuclear programme.

The grain is to come from Pakistani government stocks held by the government-run Pakistan Agricultural Storage and Services Corporation (Passco).

“It seems the (Iranian) government doesn't have the money” for the million ton shipment, a director at the leading Pakistani grain exporter Seatrade Group said. “The tender was initially for 1 million tons but the contract is only for 100,000. They (Passco) said only 100,000 had been approved because of the financing factor.” “We were supposed to give wheat and take iron ore for Pakistan's steel mills and fertiliser in return,” he said.

“The other 900,000 tons is still under discussion and might be done on the private market.” The director said Pakistani millers had also been worried that the price of flour will go up, a politically sensitive issue in the country where 90 per cent of its population consume it. Prices have increased twice in the past two weeks.

“The flour mills are worried that export at lower prices will result in them not getting sufficient wheat in January to March,” Muhammad Najib Balagamwalla, the Seatrade Group chairman, said in an email.

The wheat was being sold to Iran at US$300 per tonne FOB, a low price, Balagamwalla noted. Wheat was being sold by private exporters to Sri Lanka and other areas at US$330 per tonne FOB.

Follow Dawn Business on Twitter, LinkedIn, Instagram and Facebook for insights on business, finance and tech from Pakistan and across the world.

Opinion

Editorial

By-election trends
Updated 23 Apr, 2024

By-election trends

Unless the culture of violence and rigging is rooted out, the credibility of the electoral process in Pakistan will continue to remain under a cloud.
Privatising PIA
23 Apr, 2024

Privatising PIA

FINANCE Minister Muhammad Aurangzeb’s reaffirmation that the process of disinvestment of the loss-making national...
Suffering in captivity
23 Apr, 2024

Suffering in captivity

YET another animal — a lioness — is critically ill at the Karachi Zoo. The feline, emaciated and barely able to...
Not without reform
Updated 22 Apr, 2024

Not without reform

The problem with us is that our ruling elite is still trying to find a way around the tough reforms that will hit their privileges.
Raisi’s visit
22 Apr, 2024

Raisi’s visit

IRANIAN President Ebrahim Raisi, who begins his three-day trip to Pakistan today, will be visiting the country ...
Janus-faced
22 Apr, 2024

Janus-faced

THE US has done it again. While officially insisting it is committed to a peaceful resolution to the...