Egypt’s Mostakbal Misr says it has settled with traders for wheat stuck in ports

Several wheat shipments that had been held up at Egyptian ports for weeks due to payment issues have been cleared for unloading after the situation was resolved, state-owned grain importer Mostakbal Misr told Reuters on Thursday.

Background: On October 23, we reported that eight ships carrying Ukrainian wheat remained at Egyptian port gates due to delays in opening letters of credit for state-owned buyer Mostakbal. Market participants estimated that about 200,000 tonnes of grain remained unpaid.

The ship downtime disrupted the operating schedule of Egyptian terminals and caused additional costs for shipowners.

“Payment issues for a number of wheat shipments held up at Egyptian ports were resolved promptly. As of Wednesday evening, the issue has been resolved, and the unloading of the vessels is already gradually underway,” Mostakbal Misr said.

The agency clarified that the delay was due to new requirements from the Central Bank of Egypt, which has tightened procedures for checking letters of credit and controlling the origin of imported goods.

“Although Mostakbal Misr was not involved in the delay itself, we promptly interacted with the central bank and suppliers to quickly resolve this issue,” Mostakbal Misr added.

Two of the traders interviewed by Latifundist.com said that they had not yet received payments, but the Egyptian side promised to make settlements early next week.

“We have the letters of credit in hand. The money will be received — it’s just that the process takes longer. We are currently discounting the LC — that is, we receive funds under the letter of credit through the bank ahead of schedule. This is a standard scheme, but instead of two or three days it can last several weeks,” Rafael Goroyan, owner of Prometey, told Latifundist.com in a comment.

At Qortia AG, the problem with payments for Ukrainian wheat shipments that were previously delayed in Egyptian ports has been resolved.

Tags: Ukraine, Egypt, wheat