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Sunday, 29 July 2018

ING Groep suspends credit for Egypt wheat shipments in latest wheat drama

ING Groep suspends credit for Egypt wheat shipments in latest wheat drama: Egypt is at risk of attracting fewer numbers of offers in its wheat tenders after Dutch lender ING Groep reportedly decided to “suspend lending for wheat shipments sold to [Egypt’s] state-run buyer,” sources familiar with the matter told Bloomberg. The decision was the result of the General Authority for Supply Commodities’ (GASC) “slowed processing” of wheat transactions in recent years, which has seen ING “hit by payment disputes involving cargoes sold by AOS Trading DMCC to GASC,” according to the sources.

Egypt, however, objected to the news, saying that payments were late due to delays in delivery. “Egypt issues payments for the cargoes once suppliers have fulfilled the terms of the contract,” Supply Ministry adviser Nomani Nomani told the news service, “adding that suspending lending tarnishes the country’s image.”

Background: GASC had removed Dubai-based trader AOS from its list of approved suppliers earlier this month after repeated delays in the delivery of a shipment in June. The state-buyer had also cancelled two orders of Russian wheat from AOS. Egypt had made its most expensive wheat purchase since 2015 last week, paying an average USD 235.65 per tonne, after a drought hit Europe and the Black Sea region.

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