By Alexei Anishchuk
SOCHI Russia (Reuters) - Russia will increase exports of wheat to Egypt and imports of other agriculture products from it, Russian officials said on Tuesday as the two countries discussed the potential for free trade.
The move comes as Russia seeks new sources of supply after it banned most food imports from the United States, the European Union, Australia, Canada and Norway last week in retaliation for Western sanctions over the crisis in Ukraine.
"Egypt has already increased (agricultural) supplies to our market by 30 percent (and) is ready to increase (supplies) by yet another 30 percent in the near future," Russian President Vladimir Putin said after meeting with Egyptian President Abdel Fattah al-Sisi.
Increased Egyptian shipments of products such as potato, onion, garlic and oranges will compensate for up to half of the shortfall of these products caused by the ban, Russian Agriculture Minister Nikolai Fyodorov told reporters in Sochi.
Egypt is the world's biggest wheat importer and the largest buyer of Russian wheat. The North African country bought 3.6 million tonnes of Russian wheat in the marketing year to end-June.
"Our partners were interested in opportunities for this year's export," Putin told reporters. "For Egypt it will be at least 5-5.5 million tonnes."
Putin did not say who would supply the additional volumes. Russian grain exports are dominated by foreign and local non-government trading firms.
Putin and al-Sisi discussed on Tuesday the creation of a free trade zone between Egypt and the Moscow-led Customs Union of Russia, Belarus and Kazakhstan, Putin said.
They also discussed the possibility of setting up an Egyptian transport logistics hub on the Russian Black Sea coast and the creation of a Russian industrial hub in Egypt as part of its Suez canal development project.
Russia last year imported $17.2 billion worth of food from the countries covered by the sanctions, of which $9.2 billion was in the affected categories, according to the International Trade Centre, a joint venture of the United Nations and World Trade Organization.
(Writing by Polina Devitt and Katya Golubkova; Editing by Alexander Winning and Jane Baird)