February 21, 2014
In response to the tender for sugar procurement, some 49 domestic mills have agreed to offload about 236,000 tons of the commodity with the Trading Corporation of Pakistan (TCP). Sources told Business Recorder on Thursday that a very healthy participation was witnessed in the TCP”s sugar procurement tender as the bids are much higher than the targeted quantity.
Following the directives of the Economic Co-ordination Committee (ECC) of the Cabinet, the state-run grain trader issued a tender on February 4, 2014, for the procurement of 75,000 tons of sugar from domestic mills. The TCP was directed by the ECC to procure some 150,000 tons of sugar in two phases for Utility Stores Corporation (USC). The first tender was opened on February 19, 2014 and some 49 domestic mills evinced interest in the sale of their sugar stocks to TCP.
All the mills offered bids for different quantities with rates ranging from Rs 47,690 to Rs 55,000 per ton (incl. taxes and levies). Lowest price was offered by M/s Army Welfare Trust, while the highest bid was from M/s Chashma Sugar Mill Unit I and Unit II. Source said so far TCP has not accepted any offer as the bid evaluation is under process, after which, the price evaluation committee/tender award committee will review the quoted prices to finalise the deal. “Received bids are valid for next 15 working days and the TCP has to finalise the sugar procurement deal with suitable bidders during this period,” they added.
As per the tender”s terms and conditions, the bidders were required to quote bids for a minimum quantity of 2,000 tons and a maximum quantity of 5,000 tons. Only two mills submitted bids for minimum quantity, while the remaining are more than 2,000 tons. Overall, the TCP received bids for sale of 236,000 tons of sugar against the targeted quantity of 75,000 for this tender, they added.
Sources said the price evaluation/tender award committee is likely to meet in a few days to review the bids and finalise the sugar procurement deal. Massive participation reflects that local mills have sufficient stock of the commodity and want to offload with TCP to ease their financial issues. The ECC has already allowed TCP to apply price matching formula on sugar procurement tender, therefore it is likely that the price evaluation committee, after accepting lowest responsive bids, will offer other bidders for price matching of lowest bid to complete the tender quantity. Sources said the procured sugar will remain stored in the mills” godowns and supplied directly to the USC. Similarly, after the award of this tender, TCP will issue another tender for the same quantity.