TCP may fetch better price in fresh attempt to buy 0.5mn tonnes of wheat

LAHORE: Pakistan may fetch more rational wheat price in a fresh attempt to buy 0.5 million tonnes grains as the Trading Corporation of Pakistan (TCP) on Wednesday invited bids for import under second such tender for supply of wheat in less than a month.

The cargoes of commodity are said to be delivered during August to September 15, 2022.

According to official document, TCP, a state-owned organisation working under the administrative control of federal ministry of Commerce, floated tender in order to seek bids from the International Wheat Suppliers for supply of 500,000 tonnes of wheat directly or through their local offices or representatives through worldwide sources on CFR Karachi basis in bulk shipment.

The imports of wheat are to be made between August to September 15. In last couple of weeks, grain prices in the international market have been eased to some extent, providing some room for sourcing relatively cheaper wheat.

Contrary to this, in an earlier attempt on May 25, TCP was offered almost twice the domestic price in an international tender for buying 500,000 tonnes of wheat. In response to a global tender invited by TCP on May 17, the country received the offer of $515/ton, including Cost & Freight (C&F) for 500,000 tonnes of wheat.

There has been a record upsurge in grain prices in the international market following Russia-Ukraine war. The surging wheat price in the global market started affecting domestic market in the country. Short by about three million tons of wheat this year over annual demand, the country has to make up shortfall by importing grain.

However, the offered wheat price was too high. Now, market insiders expected that Pakistan should be able to get wheat in the range of $470-490 per ton under the second tender.

It is pertinent to mention that the price of wheat skyrocketed to over Rs2,800 per 40/kg against the official price of Rs2,200. In comparison, one kg of grain cost Rs70/kg in domestic market while in comparison the imported wheat under first shipment would cost consumer around Rs104/kg.

As per the tender document for fresh bids, wheat to be supplied shall be strictly in accordance with the prescribed standards and specification’s and Import Policy Order. Total quantity of wheat must reach the designated ports in Pakistan in accordance with the shipment schedule.

The bids must be dropped submitted before July 01, 2022, latest by 1030 hours PST. Bids will be opened on the same day at 1100 hours in presence of the bidders or their authorised representatives.

According to general specification, milling wheat of the latest crop shall be dried, having mature grains of normal size, colour and shape. It must be clean, wholesome, and free from obnoxious smell, discoloration, admixture of deleterious substances including toxic weed seed and other impurities except to the extent indicated in the specification. It should be free from all living insects and diseases and 'quarantine pests and meet the IPPC and DPP Pakistan requirements for import.

The bidders may submit their bids along with the technical specification of their wheat, to be in conformity with the following specification of ministry of National Food Security & Research.

In marketing year 2022-23, Pakistan needs to import 3.0 million tons of wheat in order to make up shortfall in production, pre-empting shortages and taming rising prices.

Out of this quantity, Economic Coordination Committee (ECC) of the Cabinet last month decided to import two million tonnes of wheat on a government-to-government (G2G) basis, while one million tonnes through an international tendering process under the existing arrangement.