International tender issued to purchase optional-origin milling wheat

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An international tender has been issued by Algeria’s state grains agency OAIC with a view to purchasing optional-origin milling wheat, traders said, with a Tuesday deadline for bids.

The tender indicated shipment from main supply regions such as the European Union could take place over March 21-31 and during the whole of April. For South American and Australian supplies, shipment should take place from Feb. 21 up to the end of March, traders said.

The latest OAIC wheat tender also specified that wheat should be shipped to two Algerian ports, Mostaganem and Tenes.

“The two ports specified are relatively small and this may mean using smaller bulk carriers than usually booked to ship Algerian wheat sales,” one trader said.

“This would give wheat from the EU an advantage, especially France, as it would not be commercially feasible to ship in small loads from more distant origins such as Argentina,” the trader added.

Another trader said: “It is unusual that only two ports are specified in Algerian purchase tenders. There is unconfirmed talk in the market that other ports could be facing congestion or lack of storage capacity.”

“The rule for two ports only could also indicate that a small purchase could be made in this tender. But the shipment period is 1.5 months instead of one month as usual, so perhaps this could allow for a reasonable volume to be bought,” the second trader said. A third trader said the aim may be to get ships to supply specific regions without the extra costs of trans-shipping via big ports.

The tender indicated a nominal volume of 50,000 tonnes but OAIC usually buys more.

In its previous tender at the end of January, OAIC is thought to have bought more than 600,000 tonnes of wheat, with shipment to take place in March if sourced from main supplier regions.—Reuters

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