WASHINGTON, July 13, 2016 – U.S. and Iraqi officials today signed a memorandum of understanding to boost U.S. rice sales to the Middle East country over the next six months, the USA Rice Federation said.
Iraq agreed to enter into two three-month contracts to buy U.S. rice, although the pact is not binding and could be revoked or extended, according to a copy of the MOU obtained by Agri-Pulse.
The document states: “The (Iraqi Trade) Ministry affirms its commitment to make regular purchases of competitively priced U.S. origin rice, using three-month supply contracts in two phases, through expressing the Ministry's interest regarding this issue to the U.S. Embassy and directly to U.S. supplier companies and associations, and in accordance with Iraqi legislation.”
Acting Iraqi Trade Minister Salman Ali al-Jumayli and U.S. Ambassador to Iraq Stuart Jones signed the agreement in Baghdad, USA Rice Federation spokesman Michael Klein said.
"This is a win for both the United States and Iraq," Jones said in a quote provided by USA Rice. "This agreement establishes the U.S. as a preferred rice supplier for major tenders for the food distribution system.”
Iraq is usually a major buyer of U.S. rice, but U.S. exporters have lost out on several tenders over recent years. U.S. exporters have complained that sales to Iraq need to be more reliable.
U.S. companies did not win any sales in the latest Iraqi tender for 80,000 tons of rice that wrapped up earlier this month, according to U.S. industry officials.
USDA data show just how erratic Iraqi purchases can be. The U.S. sold about $53 million worth of rice to the country last year, down from about $93 million in 2014 and up from $29 million in 2013. Iraq did not buy any rice from the U.S. in 2012.
The main purpose of the MOU is to try to create a more reliable and continuous supply of rice to Iraq, said Ron Verdonk, a minister-counselor for USDA’s Foreign Agricultural Service. He stressed that while the agreement isn’t binding, it is a strong step toward boosting trade.
USA Rice President and CEO Betsy Ward said, "Ambassador Jones and his staff have been excellent advocates for U.S. rice… We appreciate all they've done for our industry and look forward to regular shipments of U.S. rice going to the people of Iraq."
Under the MOU, the U.S. promises to educate Iraqi government officials on technical aspects of the U.S. rice sector including facilitating trips to the U.S. for Iraqi Trade Ministry officials.