The riches on offer by supplying Black Sea grains around the world is proving too hard to ignore for Gemcorp Capital LLP, a financial and trading company in London. The company won contracts in Ethiopian tenders in April to supply 900,000 tons of wheat, and will mainly source supplies from Russia, Ukraine and Romania. That’s about as much as Louis Dreyfus Co. and Olam International exported from Russia last season, according to estimates from Russian consultant ProZerno. Gemcorp says it wants to ship more in the coming years. While Gemcorp has handled agricultural commodities since 2016, the Ethiopian tenders have brought the first large-scale deals for the company and would mark its emergence as a big operator in the Black Sea. Gemcorp, which was founded by former Goldman Sachs Group Inc. partner Atanas Bostandjiev in 2014 and focuses on emerging markets, is one of the latest companies to expand in Black Sea grains. The area’s export market share expanded in the past decade thanks to bumper harvests and competitive prices. Africa, where Gemcorp has made loans, is among the biggest buyers of Black Sea wheat. “We initiated more extensive operations after identifying a chance to take part in Ethiopia’s tenders,” Sergei Potapov, general director at Gemcorp’s trading arm in Russia, told Bloomberg. “The general idea is to create a supply chain not only in Russia, but also start working in Ukraine and other grain origins.” For the Ethiopian tender contracts, Gemcorp may source most of the wheat from Russia, Potapov said. That could see Russia’s exports of the grain to the African country reach a record. As well as sourcing directly from farmers, Gemcorp plans to buy from other traders and boost grain shipments from Russia to several million tons a year. The company wants to tap demand from major importers in Africa and the Middle East, including Egypt and Saudi Arabia. It has gained port-service quotas to ship grain from two Black Sea terminals this season and is in talks with other terminals to expand volumes, Potapov said. Black Sea grains are also drawing interest from other companies, including Russia’s VTB Group. The banking group recently bought assets including port terminals, a rail-freight operator and a trader, and has proposed creating a domestic grain champion. Gemcorp plans to expand its trading interests in Russia to barley and sunflower oil in the future. But for now, the large Ethiopian wheat deals, which may take several months to wrap up, are a crucial test for whether the company can become a substantial player in the market. “We recognize the scale and importance of these contracts and have undertaken significant measures to ensure timely delivery,” Hay said. BLOOMBERG