UPDATE 2-EU sanctions slash Ukraine maize exports to Iran
* Drop due to EU sanctions hitting payments
* Ukraine says holding talks with Iran on grain trade
* Ukraine does not want to lose Iran market-Minister (Adds Farm Minister comment, export data)
By Pavel Polityuk
KIEV, Feb 3 (Reuters) - Ukraine's maize exports to Iran dropped 40 percent in January due to problems collecting payment from Iranian buyers after the European Union tightened sanctions, a leading Ukrainian agricultural consultancy said on Friday.
Ukrainian and European traders said this week they were no longer booking cargoes on Iranian ships to transport grain exports from Ukraine because of difficulties with payments following European Union sanctions.
As news of the drop in maize exports to Iran emerged, Ukraine's farm minister said grain traders were in talks with Iran to save a valuable market. The ex-Soviet republic is a top maize producer and exporter in the Black sea region.
"Talks are underway with Iran on the issues which have emerged. Today, grain traders are holding consultations (with Iranian traders) but it is important for us to avoid losing this market and other markets too," Ukraine's grain traders' union UZA quoted the minister, Mykola Prysyazhnyuk, on Friday as saying.
It was not clear at what level these talks with Iran, a major importer of food and animal feed, were taking place. Most Iranian grain deals are between private entities, traders said.
Iran in 2011/12 is expected to import around 4.5 million tonnes of grain, including about 3.5 million tonnes of corn, the leading world grain for animal feed, according to International Grains Council figures. It ranks among the top 10 global importers of maize.
Its key corn suppliers include Brazil, Argentina and Ukraine.
Iran's total grains production for 2011/12 is forecast at 18.7 million tonnes, down from 20.7 million a year earlier. Wheat production is seen at 13.8 million tonnes versus 15.5 million, potentially drawing in more imports from Russia and Kazakhstan, traditional suppliers of high quality wheat.
The EU late in January agreed a ban on Iranian oil imports and in addition decided to freeze the assets of Iran's central bank in a move to put pressure on Tehran's disputed nuclear programme by shutting off its main source of foreign income.
Around 400,000 tonnes of grain largely from Ukraine and Russia is held up on about 10 ships stranded outside Iranian ports because of payment problems.
Some vessels have now left for other ports.
Maize exports to Iran from Ukraine, the top exporter in the Black Sea region fell to 130,000 tonnes in January from 217,000 tonnes in December and 238,000 tonnes in November, ProAgro consultancy said quoting port data.
Ukraine harvested a record 22.7 million tonnes of maize, in 2011 and the exportable surplus could reach 10 million tonnes in the 2011/12 season.
The former Soviet republic exported 6.2 million tonnes of maize in the first seven months of the current season.
Ukraine exported 634,194 tonnes of maize to Iran in the 2010/11 season and 73,600 tonnes in 2009/10.
Ukraine plans to remain a top maize producer and exporter in the Black Sea region in 2012 with a harvest of about 25 million tonnes, analysts said. (Reporting by Pavel Polityuk; editing by Richard Balmforth and Keiron Henderson)
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