Iran boosts strategic grain stocks with wheat buy
Iran's state grain buyer continued to build its strategic stocks, purchasing at least 240,000 tonnes of milling wheat this week, as a drought-fuelled grain price rally kept food security on government radars, Reuters reported.
Taking advantage of the recent correction lower in grain markets, after a steep rise in June and July, traders said Iran's purchase included German and Baltic Sea region wheat.
"Iran's been what everyone has been working on this week, they've definitely been very active this week," said a European trader.
Iran's Government Trading Corporation (GTC) continued its discreet method of contacting traders directly for offers, making it difficult to glean details of total purchases.
Iranian grain imports are usually handled by the private sector but the state was compelled to step in and help with purchasing earlier this year because of the disruption to trade financing caused by sanctions aimed at Iran's disputed nuclear programme.
While the sanctions do not target food shipments, they made it difficult for importers to obtain letters of credit or conduct international transfers of funds through banks.
However, traders noted that private Iranian buyers had also been in the market this week, signalling they may have found ways to finance purchases.
"We have also seen private buyers from Iran inquiring about European, Russian and Australian wheat for September shipment. It seems they want to buy for August-March shipment. The financing does not seem to be a major issue," a European trader said.