August 9, 2006

India's STC may approach AWB to buy up to 70,000 tonne wheat

State Trading Corp. of India Ltd may approach Australia's AWB Ltd to buy up to 70,000 tonnes of wheat under a recently issued tender to import 400,000 tonnes, a government official said Wednesday (Aug 9).

STC decided Monday (Aug 7) to buy 330,000 tonnes wheat of Russian origin at around US$210-US$212/ton, on cost and freight basis from Switzerland-based trading house Agrico Trade & Finance SA for delivery in September and October.

"Since the company (Agrico) quoting the lowest price has not tendered to sell the entire quantity so far, STC may approach other bidders such as AWB," the official told Dow Jones Newswires.

STC received eight bids in the range of around $210-$239/ton, but no company offered to sell 400,000 tonnes. Initially Agrico Trade offered only 200,000 tonnes wheat.

"Our main concern is the price; the price bids in this tender are quite high," said the official.

The official said the offer of the second-lowest bidder - Singapore-based Agrocorp International, which offered around 90,000 tonnes of wheat - is difficult to accept for technical reasons. The company failed to submit the mandatory bid-bond on time, he said.

AWB has offered to sell 220,000 tonnes wheat and is the third-lowest bidder in terms of price.