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Brazil buys Russian wheat after expanding ex-Mercosur quota

By Polina Devitt, Olga Popova and Roberto Samora

MOSCOW/SAO PAULO, July 22 (Reuters) - Russia shipped two wheat cargoes to Brazil this month, totaling 60,000 tonnes, in the first trades of their kind this year, according to people with knowledge of the matter.

Purchases of the Russian cereal, confirmed by sources at trading firms Sodruzhestvo and Glencore, followed a new tariff-free quota for Brazilian wheat imports from outside the Mercosur bloc, which includes neighboring Argentina, Brazil's main wheat supplier.

Brazil imported 91,700 tonnes of wheat from Russia in all of last year, according to data from the Brazilian government, while in 2018 it imported only 26,200 tonnes.

At least two more similar deals may have been closed recently, according to two other trade sources, all of whom requested anonymity because the information is not public.

Those additional deals could not be independently confirmed.

Brazilian wheat industry group Abitrigo has said Russia, Canada and the United states are likely to benefit from a new tariff-free import quota for 750,000 tonnes created last year.

Brazil is expected to import a record 7.3 million tonnes in 2020, as demand rises during the COVID-19 pandemic. At the same time, a drought and economic struggles in Argentina have thrown imports from there into question.

Still, Argentina supplied 3.12 million tonnes of Brazil's 3.5 million tonnes of wheat imports in the first half of the year, according to trade data.

The United States is a distant second-place supplier, with 172,000 tonnes, followed by Mercosur members Paraguay and Uruguay, with 97,000 tonne and 80,000 tonnes, respectively. (Reporting by Polina Devitt, Olga Popova, and Roberto Samora Writing by Ana Mano; Editing by Aurora Ellis)

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