PHOTO
(Recasts with confirmation from tender document)
ABU DHABI/HAMBURG, Aug 31 (Reuters) - The latest international tender for the purchase of wheat by Egypt's state grain buyer GASC includes a requirement that the wheat is completely free of ergot fungus, a document seen by Reuters shows.
A ban on the common grain fungus earlier this year caused huge disruption to Egypt's massive wheat imports, with global trading houses declining to take part in its tenders.
Having lifted that ban in July, Egypt announced on Sunday that the ban would be imposed again despite suppliers' insistence that it is virtually impossible to guarantee zero ergot content.
A document outlining wheat specifications for the tender closing on Wednesday stated that, in accordance with an agriculture ministry decision, the tolerance for ergot fungus in imported wheat should be zero percent.
GASC, which has in the past used the common international standard of 0.05 percent ergot content, made no immediate comment.
"My impression is that Egypt is testing to see if it is possible to undertake a purchase tender with zero ergot content," one European trader said.
"Those who offer today would be fully aware of the risk if the zero content is confirmed."
A reversal to zero could mean a majority of suppliers shun GASC tenders once more on worries their shipments would be rejected on arrival at Egyptian ports.
"Under these conditions there will be no offers," another European trader said.
GASC normally falls under Egypt's supply ministry but is being run by trade minister Tarek Kabil since the resignation of supply minister Khaled Hanafi amid a government investigation into corruption in the wheat sector.
Ergot can lead to hallucinations if eaten in large quantities but is considered harmless at low levels. (Reporting by Michael Hogan, Maha El Dahan and Eric Knecht; Additional reporting by Sybille de la Hamaide and Valerie Parent in Paris; Editing by Mark Potter and David Goodman) ((michael.j.hogan@thomsonreuters.com; +49 40 419 03 4275; Reuters Messaging: michael.hogan.thomsonreuters.com@reuters.net))
ABU DHABI/HAMBURG, Aug 31 (Reuters) - The latest international tender for the purchase of wheat by Egypt's state grain buyer GASC includes a requirement that the wheat is completely free of ergot fungus, a document seen by Reuters shows.
A ban on the common grain fungus earlier this year caused huge disruption to Egypt's massive wheat imports, with global trading houses declining to take part in its tenders.
Having lifted that ban in July, Egypt announced on Sunday that the ban would be imposed again despite suppliers' insistence that it is virtually impossible to guarantee zero ergot content.
A document outlining wheat specifications for the tender closing on Wednesday stated that, in accordance with an agriculture ministry decision, the tolerance for ergot fungus in imported wheat should be zero percent.
GASC, which has in the past used the common international standard of 0.05 percent ergot content, made no immediate comment.
"My impression is that Egypt is testing to see if it is possible to undertake a purchase tender with zero ergot content," one European trader said.
"Those who offer today would be fully aware of the risk if the zero content is confirmed."
A reversal to zero could mean a majority of suppliers shun GASC tenders once more on worries their shipments would be rejected on arrival at Egyptian ports.
"Under these conditions there will be no offers," another European trader said.
GASC normally falls under Egypt's supply ministry but is being run by trade minister Tarek Kabil since the resignation of supply minister Khaled Hanafi amid a government investigation into corruption in the wheat sector.
Ergot can lead to hallucinations if eaten in large quantities but is considered harmless at low levels. (Reporting by Michael Hogan, Maha El Dahan and Eric Knecht; Additional reporting by Sybille de la Hamaide and Valerie Parent in Paris; Editing by Mark Potter and David Goodman) ((michael.j.hogan@thomsonreuters.com; +49 40 419 03 4275; Reuters Messaging: michael.hogan.thomsonreuters.com@reuters.net))
