DUBAI: Pakistan is yet to ship any wheat to Iran from a 1-million tonne barter deal agreed last August due to government disagreements, an executive from Pakistani grain exporter Seatrade Group said.

International and local trade sources said progress on the deal could be slowed further by Iran's finding ways to work around sanctions with food purchases and looming elections in Pakistan.

A first shipment of 100,000 tonnes was supposed to be delivered to the Iranian port of Bandar Abbas in mid-Feburary, said the executive who declined to be named.

“The 100,000 tonnes is still in the pipeline, nothing has been shipped...a government-to-government issue that needs to be resolved,” he told Reuters on the sidelines of an industry in the United Arab Emirates on Tuesday.

He declined to give further details on what the dispute concerned, however industry sources told Reuters that it might involve finance disruptions from Iran's side.

Iranian wheat imports are usually handled by the private sector and government, but in recent months the state has taken a bigger hand in purchases as trade finance has been tightened due to western sanctions aimed at Iran's disputed nuclear programme.

The executive said Iranian inspectors had been to Pakistan this month to check the grain, which they say did not match their specifications.

“It's still an ongoing process and we don't have a shipping schedule yet so it's hard to tell when the shipment will be made,” the executive said, adding initial negotiations on the barter deal were for 4.5 million tonnes, but so far only 1 million has been agreed on.

The barter deal, first proposed last year in March with Iran exporting fertiliser and iron ore to Pakistan in exchange for wheat, was deadlocked for months over price and quality.

In August, Pakistan agreed a price of $300 per tonne, an official from the country's Ministry of National Food Security and Research told Reuters.

International traders said they did not expect quick progress as Iran had room to take its time in ensuring all aspects of the deal work, as the country has bought large volumes of wheat by working around sanctions.

“Iran does not seem to have such a pressing need for wheat as was seen last year when the barter deal with Pakistan was proposed and Iran was making huge wheat purchases on the international market,” a European trader said.

“Iran's last wheat purchase showed a sanctions risk premium of about $10 a tonne which is a fairly moderate level.” Iran's state grains agency GTC bought 180,000 tonnes of Australian wheat at a price of around $405 a tonne c&f, traders said earlier in February.

Local trade sources said decision-making in Pakistan government ministries was also slow due to looming elections.