Egypt Ports Face Backlog, No Grain Shortage

Published February 07, 2011

| Reuters

Ongoing port delays and reduced banking services continue to weigh on cargo shipments to Egypt although the country does not face any grain shortages, trade and shipping sources said on Monday.

President Hosni Mubarak's new cabinet on Monday held its first full meeting since an uprising started nearly two weeks ago, with no concrete progress in talks with Islamists and an opposition who demand his immediate exit. 

The government has tried to get the country back to normal when the working week began on Sunday with banks reopening at reduced hours after a week-long closure and the curfew shorted.

Shipping sources however said cargo operations at the Mediterranean ports of Alexandria, Damietta and Port Said, which especially handle bulk and container shipments including grains, had yet to return to full strength.

"The ports are open for business as usual although there is a massive backlog they are trying to clear," said Dan Delany, an Alexandria-based agent for the Lloyd's of London insurance market. "There are going to be delays."

Danish shipping and oil group A.P. Moller-Maersk said on Sunday vessel operations at its Port Said container terminal were "near normal."

While the situation continued to impact its overall Egyptian operations, the "level of activities was nearing a normal level under the circumstances," it said in a statement.

"It is not possible to give an assessment of when the situation will be fully normalised," Maersk said.

Shipping sources said trucks were able to enter ports on Sunday and pick up cargoes again after more than a week when a lack of customs officials and protests had hampered deliveries.

"Some delays and congestion of stacking areas may be experienced, although import container consignees have started picking up shipments and custom clearance is working half-day at Alexandria port," logistics company GAC said on Monday.

"Break bulk operations are only permitted for non-direct delivery cargo, and discharge operations are slow, due to a shortage of labour and diesel for shore equipment. Silos for bulk cargo are working."

SHIPMENT CONCERNS

Trade sources said some grains exporters still had worries over letters of credit payments due to limited banking hours.

Egyptian banks were open from 10 a.m. (0800 GMT) until 1:30 p.m. on Monday.

Egypt, the world's largest wheat importer, has said wheat shipments had been arriving with no delays at ports. The main state wheat buyer purchased 170,000 tonnes of soft wheat on Saturday.

"There is still considerable concern about the status of Egyptian shipments because of the continued problems with banks and ports," one European trader said.

"The country has just said that it has wheat stocks for six months, this is its normal minimum and is not particularly high but I do not think they face rapid pressure on stocks."

Another trader said 180,000 tonnes of grains was expected to unload between Feb. 11-20 alone.

"The market is concerned about whether this will be landed or not. Much will depend if the bulk terminals get back to full work," the trader said. "I think overall that Egypt has pretty good supplies and does not face an immediate supply crunch."

Determined protesters in Cairo's Tahrir (Liberation) Square were settling into a routine on Monday after a bloody revolt which the United Nations says may have cost 300 lives so far.

URL

http://www.foxbusiness.com/markets/2011/02/07/egypt-ports-face-backlog-grain-shortage/