|14 August, 2019

Germany seeks new wheat export markets as Saudi Arabia opens to Russia

"The export chances for German wheat to Saudi Arabia could fall in future," the association of German farm cooperatives, DRV, said in a statement on Wednesday.

Image used for illustrative purposes. Winter wheat is pictured at a field in Koesching near Ingolstadt July 26, 2012.

Image used for illustrative purposes. Winter wheat is pictured at a field in Koesching near Ingolstadt July 26, 2012.

REUTERS/Michaela Rehle

HAMBURG- German wheat exporters are seeking access to new markets including China, Mexico and Indonesia, an industry association said, following signals that Saudi Arabia is about to open up to imports from Russia.

Saudi Arabia has been Germany's biggest market for wheat exports in recent years, but German firms face much tougher competition after Saudi state grain buyer SAGO said last Thursday that it will relax quality specifications for wheat imports from its next tender. The move is seen as opening the door to Black Sea imports, especially from Russia. 

"The export chances for German wheat to Saudi Arabia could fall in future," the association of German farm cooperatives, DRV, said in a statement on Wednesday. "The country has recently reduced its quality demands for imports."

"This has increased the danger that in coming months more wheat from the Black Sea region will flow into the Middle East."

Germany will have to seek access to new markets for its wheat, it said.

"The DRV is working jointly with other associations in the German grains industry to achieve market entry to Mexico, China and Indonesia."

However, achieving market access is a complex issue involving extensive negotiations about food safety and quality regulations which could take a long time, it said.

(Reporting by Michael Hogan; Editing by Susan Fenton) ((michael.j.hogan@thomsonreuters.com; +49 172 671 36 54; Reuters Messaging: michael.hogan.thomsonreuters.com@reuters.net))

More From Markets