We imported 24% more wheat from Russia in March than we did the same time last year, buying some 479k tons of Russian wheat last month despite the ongoing war in Ukraine and its impact on the global grain market, Reuters reports, citing freight data.

That means nearly 30% of Russian wheat exports in March headed our way. The country exported some 1.7 mn tons of wheat in March — up 60% y-o-y despite disruption caused by its war. Shipments were running at a “rapid” rate in the second half of the month after an initial slowdown in February, as most challenges with payments and shipping vessels were resolved, Bloomberg previously reported.

Russian wheat has kept on coming — but it hasn’t necessarily been paid for yet. Payments have been settled on some cargoes bought before the war broke out at the end of February, but sanctions have complicated fresh transactions. Buyers are still “trying to figure out a secured channel” to pay for March purchases and are negotiating with banks to resolve issues on a case-by-case basis, traders told Reuters.

Ukrainian wheat is another story: Our imports of Ukrainian wheat plunged 42% y-o-y last month, to record 124.5k tonnes.

Ukrainian grain exports could go back to pre-war levels as soon as the country’s ports re-open, Deputy Economy Minister Taras Kachka told Bloomberg Asharq (watch, runtime 1:24). The global grain shortage and price jumps are “all because of Russia’s closure of Ukrainian ports,” he said, adding that Ukraine is sitting on 6 mn tonnes of wheat. Blockaded ports mean there’s little to no grain coming out of Ukraine. Russia and Ukraine combined usually account for more than 80% of our wheat imports.

SOUND SMART- The private sector is driving wheat imports right now. The data doesn’t break down the split between public and private wheat purchases. That said, state grain-buyer GASC hasn’t made a successful tender since the war began — and doesn’t plan to try again until mid-May, after having received all its backlogged orders of Russian wheat. This marks an acceleration of a trend that last year saw the private sector eclipse the state as Egypt’s leading wheat importer. The government is instead focusing on the local harvest, and will spend around EGP 36 bn to purchase 6 mn tons of wheat from local farmers to replenish strategic reserves.

And private wheat players are diversifying away from Black Sea wheat: Higher prices amid the supply squeeze haven’t deterred the private sector from tapping suppliers beyond Russia and Ukraine, according to Reuters data. Traders have secured shipments from “unusual” suppliers including France, Brazil, Lithuania, Bulgaria, and even Germany — which hasn’t sent us wheat in years, the newswire notes.

SCZone to ink agreement on grain packaging facility

SCZone signs agreement with Emirati-Egyptian consortium to build grain packaging factories in East Port Said: The Suez Canal Economic Zone (SCZone) will within days sign an agreement with Emirati firm Rosa Grains and local player Roots Commodities to build eight grain packaging factories worth EGP 100 mn each in East Port Said, SCZone head Yehia Zaki told Enterprise, confirming a report from Al Mal.

Background: The factories form part of the EGP 2.2 bn bulk grain terminal the two companies will build for the SCZone’s planned East Port Said logistics hub. The agreement for the terminal — through which 7.2 mn tons of grain are expected to be traded each year — is separate to the factories and is still pending House approval.