In 2016, Bangladesh can import 4 mln tonnes of wheat

Source

APK-Inform

3641

 

 

 

 Bangladesh is one of the large importers of wheat on Asian market. In 2015/16 MY the country can increase wheat imports. Taking to account high interest Ukrainian exporters pay to Bangladesh, APK-Inform spoke with Mr. Okan Bayer, the head of Seakіng Shіppіng LTD.HONG KONG and Peakward Denіzcіlіk ve Tіcaret LTD. STІ TURKEY working on Bangladeshi market.

 

- First of all, would you tell us about activity of your company?

Seakіng Shіppіng LTD.HONG KONG was founded in 1990 in Hong-Kong. During more than 25 years we operate on the market. We trade with grains and many other commodities on Asian market. Bangladesh is one of the key market for our products, but also we have offices in Turkey, China, India, Indonesia, Vietnam and UAE. Our subsidiary Sea King Shipping Ltd, BVI provides services for sea transportation.

 

- Let’s discuss Bangladeshi market. Tell us about wheat imports to the country this year.

We expect Bangladesh to import about 3.6-3.8 mln tonnes of wheat this year. Moreover, the country can import at least 3.8 mln tonnes of the grain in 2016. Imports even can reach 4 mln tonnes if wheat price on the global market to remain attractive for local buyers.

 

- Which countries are the key suppliers of wheat to Bangladesh?

Among the key suppliers of wheat to Bangladesh we can underline USA and Brazil. Moreover, the country imports significant volumes from Ukraine that was encouraged by government-to-government agreement on grain supplies signed by Ukraine and Bangladesh.

Three mentioned countries supply about 3.2 mln tonnes of wheat to Bangladesh.

 

- USDA forecast Bangladesh to increase grain consumption in 2015/16 MY. Will it have an impact on grain imports to the country?

As I mentioned above, there is a possibility for increase of wheat imports to Bangladesh. Moreover, the country imports significant volumes of rice. However, in 2015/16 MY shipments of rice to Bangladesh can decline noticeably and total 0.6 mln tonnes against 1.2 mln tonnes year ago. Decrease of rice imports will happen due to its high supply on the domestic market. Moreover, 10% rice import tax imposed by Bangladeshi government in order to restrict imports of cheap Indian product will affect rice purchases too.

 

- This year Bangladesh faced some problems while imported wheat from France caused by unsuitable grain quality. Moreover, there were problems with quality of Brazilian wheat. Are there any signs that Bangladeshi government will mitigate requirements for imported wheat?

Currently, there are no news on the matter. As to the mentioned problems, in both cases the protein content of wheat supplied to the country did not correspond to the index pointed in the contract. For example, Ministry of Food of Bangladesh faced high criticism when they bought in frames of governmental tender 200 thsd tonnes of Brazilian wheat with low quality thet did not suit requirements.

 

- Let’s talk about freight rates. How the global market of freight is developing now? What are your forecast for future?

We expect global market to face decline of freight rates for grains. The bearish trend can be observed until late 2017. In general, the matter is rather difficult as freight rates depend on many factors. Nowadays bunker price is the key factor that influence of freight rates on the global market. In turn, bunker price depends on many aspects, even political ones. Thus, bunker price increased a bit when Russia started its military activity in Syria, that than led to higher freight rates.

 

 

- Nevertheless, can you point out the key factors determining freight rates?

There are three key factors. The first, as I mentioned above, is bunker price. The second is the current situation with time charter party and Baltic Dry Index. And the third is weather. If we are talking about Black Sea ports we have to take into account the winter period when ports activity can be restricted. When we talk about Bangladesh we need to remember about monsoon season that influence on landing carriage and demurrage time.

 

- What are the current freight rates for wheat shipped to Bangladesh?

Unfortunately, it is difficult to point out the exact figure as all depends on tonnage and origin. Nevertheless, the average index varies between $16-25 per tonne.

 

Interviewed by Inna Chernenko

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