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Our Bureau

High rates may prevent Centre from contracting entire 10 lakh tonnes

New Delhi May 21

The State Trading Corporation of India's (STC) first wheat import tender for the current year has not elicited the best of responses for the Centre.

The 10-lakh-tonne (lt) tender, which was floated on April 30 and opened here on Monday, saw bidders quoting between $267 and $302 per tonne, cost & freight.

This is way above the weighted average landed price of $205.31 per tonne at which STC had contracted imports totalling 55 lt on Government account last year.

The latest tender attracted bids from seven parties, including Toepfer International of Germany, the US-based commodity giant Cargill and Archer Daniels Midlands, Concordia Agritrading of Singapore, Glencore International of Switzerland, and the Adani Group.

Toepfer, it is learnt, bid the lowest at $267 per tonne. But even this Hamburg-based trading house apparently offered to supply only 1.2 lt before the August 15 deadline stipulated in the tender.

"Everybody offered to supply additional volumes only after September. Whether or not this is acceptable to STC remains to be seen," sources said. The present bids are valid up to May 30.

The sources felt that given the high rates quoted, the Centre is unlikely to contract the entire tendered quantity. "It may be better to float new tenders after July, when European wheat will start arriving in the market. In any case, there is now urgency to import right now," they added.

Central pool

Meanwhile, procurement for the Central pool is inching towards the 100-lt mark, with the Food Corporation of India and State agencies buying 98.6 lt during the 2007-08 rabi marketing season (April-June) till Sunday. Of the total 98.6-lt, Punjab has contributed 63.57 lt, Haryana 30.67 lt, Rajasthan 2.63 lt, Uttar Pradesh 1.55 lt and Madhya Pradesh 14,786 tonnes.

The 98.6 lt does not include the 6.04-lt separately procured by the Punjab Government for its own subsidised flour supply (Atta Dal) scheme. "If you add the 6.04 lt, we have already surpassed 100 lt, which is also higher than the 92.25-lt purchased for the whole of the 2006-07 season," officials said.

As on April 1, wheat stocks in the Central pool, at 45.63 lt, stood higher than the minimum buffer norm of 40 lt for that date.

With procurement of around 105 lt this season and monthly offtake requirement of 10 lt, the supply situation is just about comfortable, though imports of 20-30 lt may still be needed to be on the safe side.

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STC wheat import tender: Bidders quote $267-302/t

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