Private Iranian buyers have purchased about 25,000 tonnes of milling wheat to be sourced from Ukraine, European traders said on Tuesday. It will be shipped in the second half of May from Odessa or Nikolaev, they said. The deal follows a series of purchases by private Iranian buyers in late March to early April, traders said. High state guaranteed wheat prices in Iran's domestic market means mills are turning to wheat imports, especially for production of flour for re-export to other Middle Eastern countries, traders said.
On March 5, traders said Iranian private buyers had purchased about 85,000 tonnes from the European Union and Black Sea region. Some traders expect major demand from Iranian private buyers if a deal is agreed in talks with world powers about Iran's nuclear programme which would give Iran more purchasing power after years of sanctions. Iran, once Opec's second-largest oil producer after Saudi Arabia, hopes to raise crude exports by as much as 1 million barrels per day if Tehran and six major powers finalise a nuclear agreement by a June 30 deadline. The sides reached a framework accord on March 31.
Iran was never barred from buying food under western sanctions over its disputed nuclear programme, but EU and US sanctions have made trade more difficult by hindering payments and ocean shipping. "Much will depend on the outcome of the nuclear talks and also the outcome of Iran's wheat harvest, which is now getting under way," a trader said. One trader said Iranian state agencies may not import wheat this year and that the country has large stocks, with more shipments under way from countries including Germany following past Iranian purchases. Some 300,000 tonnes of German and Baltic Sea region wheat was loaded in March and April for Iran from purchases dating back to 2014, a trader said.