March 22 (Bloomberg) -- Iran, facing international sanctions over its nuclear program, is seeking to buy more agricultural commodities from India after agreeing to import soybean meal used in livestock feed, said an exporters’ group.
The country “is interested in importing wheat, sugar, soybean meal and tea,” Ajay Sahai, director general of the Federation of Indian Export Organisations, said in an interview. “I don’t think payment is an issue.”
India, Asia’s third-biggest economy, and Iran are struggling to maintain bilateral trade after the U.S. and its allies imposed economic and financial sanctions to prevent what they say may be efforts to develop a nuclear weapon. Iranian traders have already bought 100,000 metric tons of soybean meal. The Persian Gulf state is seeking as much as 3 million tons of wheat, India’s Agricultural & Processed Food Product Export Development Authority, or APEDA, said on its website.
Iranian traders bought soybean meal for delivery next month at prices ranging from $430 a ton to $435 a ton free-on-board basis, said Rajesh Agrawal, a spokesman for the Soybean Processors Association of India. Exports to the country may increase, he said in a phone interview today.
Iran’s Kengan Wheat Flour Factory requires 30,000 tons of wheat, while ALP Co. plans to buy 600,000 tons over the next one year, the Indian APEDA said on its website.
“The Indian exporters are exploring the viability of exports to Iran depending on the actual commercial terms and phytosanitary requirements,” Asit Tripathy, chairman of APEDA, said in an interview today.
Two calls to Hasan Rahimi Majd, press councilor at the Iranian embassy in New Delhi, seeking comment weren’t answered.
India will “snap” up any trade opportunities that emerge because of the sanctions on Iran, Rahul Khullar, commerce secretary, said on Feb. 9.
India and Iran are considering bartering commodities and other products for crude through a rupee account with UCO Bank, two people with knowledge of the matter said Feb. 1. Sanctions are threatening $9.5 billion in annual crude trade between India and Iran, after the Reserve Bank of India dismantled a mechanism used to settle payments in euros and dollars in December 2010.
Shipments of basmati rice to Iran will be maintained at 1 million tons a year, the All India Rice Exporters’ Association has said. India will have enough food grains for exports till 2014, Food Minister K.V. Thomas said yesterday.
State stockpiles of rice and wheat were 54.43 million tons as of March 1, compared with 45.88 million tons a year earlier, according to state-run Food Corp. of India. The country, which has permitted mills to ship 2 million tons of raw and refined sugar since the start of the crop year on Oct. 1, will have a surplus of an extra 2 million tons, according to the National Federation of Cooperative Sugar Factories Ltd.
“It’s not certain whether they will buy from India or not,” Sahai said. “Indian wheat prices are higher than international prices. I have my reservations whether Iran will buy from India” or whether they will go elsewhere, he said.
Iran also wants to buy steel from India, Sahai said.
The Islamic state is seeking food supplies through barter with Pakistan as well, Tanveer Alam, a public relations officer at the Ministry of Water and Power, said March 19. The country may export 1 million tons of wheat and 200,000 tons of rice to Iran in return for fertilizer and iron ore, he said.
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