Get the latest updates as we post them — right on your browser

. Last Updated: 07/27/2016

Egypt Eyes Major Russian Wheat Buy

CAIRO, Egypt -- Russia and Egypt resumed talks this week on a possible five-year deal to supply an annual 1 million metric tons of wheat to the most populous Arab state, which had been put off in March due to concerns about the war in Iraq.

Official Egyptian sources said on Tuesday that the talks had resumed on Monday.

They said Egyptian Supply Minister Hassan Khidr and Foreign Affairs Minister Faiza Abu el-Naga held a second day of talks with the visiting Russian delegation on Tuesday. The Russian team is due to meet Prime Minister Atef Obeid on Wednesday.

"A delegation has gone to Egypt to coordinate technicalities of a wheat deal," said a spokeswoman for the Economic Development and Trade Ministry in Moscow. She did not give any further details.

Egypt, a country of almost 70 million people, is one of the world's biggest wheat buyers, purchasing some 7 million metric tons of the grain each year.

Egypt and Russia had been expected to sign the deal in March, after it was postponed in January. But last month Agriculture Minister Alexei Gordeyev said it had been delayed because of the war in Iraq.

Cairo wants to swap the Russian grain for agricultural goods Russia does not produce or grow in sufficient quantities, like citrus fruit, garlic, onions and early potatoes.

Russia had a bumper grain crop of 86.6 million tons last year, including 50.6 million tons of wheat. But this year the country expects the harvest to decline to 70 million to 75 million tons.

A Russian wheat deal could have an impact on Egypt's future wheat purchasing policy.

But Egypt's main official wheat buyer, the General Authority for Supply Commodities, said last month it did not plan to add Russia to the list of countries it invites to bid in its regular wheat tenders.

Egypt is a long-time recipient of U.S. aid and has traditionally favored U.S. wheat, often even when it has been priced higher than competing origins.

It ranked as the top export destination for U.S. wheat for the past five seasons, but has slipped to No. 6 in 2002-03 by opting for cheaper supplies from France and Eastern Europe after U.S. prices rose to five-year highs in September due to drought.