Saturday August 13, 2022

Pakistan renegotiates lower price for Russian wheat

August 06, 2022

ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet has decided to offer wheat import price of $390 per tonne to the Russian side and to cancel the tender if they do not accept the offer.

Federal Minister for Finance and Revenue Miftah Ismail presided over the meeting of the ECC of the Cabinet online on Thursday. The ECC considered only one issue, which was related to the import of wheat from Russia through the G2G agreement.

Federal Minister for Power Khurram Dastgir Khan, Special Assistant to PM Tariq Fatemi, Minister of State for Petroleum Musadik Masood Malik, Special Assistant to PM on Government Effectiveness Dr Muhammad Jehanzeb Khan, Coordinator to PM on Economy Bial Azhar Kayani, federal secretaries and other senior officers attended the meeting.

Ministry of National Food Security and Research submitted a summary on supply of milling wheat from Russia on G2G basis. It was informed that in compliance with the decision of the federal cabinet by ECC on May 28, 2022 for the import of 3 million tonnes of wheat, TCP initiated the process of import of wheat from the Russian government on G2G basis.

In this context, a memorandum of understanding was signed between Russian SOE and TCP on 08-06-2022. Initially, government of Russia offered wheat price $410 per metric tonne.

A committee was constituted by the PM office under Tariq Fatemi, Advisor to the PM on Foreign Affairs to negotiate with the Russian Embassy on the price issue of imported wheat.

Meanwhile, a Russian delegation met with the minister for commerce and offered a reduced price of wheat at $405 per tonne. Later on the price was further reduced to $400 per tonne.

Finally, Ministry of National Food Security and Research on the recommendations of the Ministry of Commerce submitted the price offered by M/s Prodintorg, a state-owned company of the government of Russia at $399.50 per tonne for supply 120,000 tonnes at 5 percent more or less of sellers’ option of milling wheat through the G2G arrangements for the consideration of the ECC.

The ECC observed that the price of wheat was showing a declining trend, and it might reduce further in the coming days.

It was therefore decided that Russian side should be offered the price of $390 per tonne and tender might be cancelled if they do not accept the offer.