ETHIOPIA – Promising International Trading, a UK company and Phoenix Commodities, are supplying 60pc and 40pc of the 222,000tn of wheat the government is buying for the replenishment of the strategic grain reserve.

Another company, the Bassiouni Group, has lost a contract for the supply of 200,000tn, which the Public Procurement & Property Disposal Service (PPPDS) says it had awarded it earlier. This supply is not part of the strategic reserve, but intended to be distributed to factories.

Promising and Phoenix were selected from six that were invited by the Public Procurement & Property Disposal Service (PPPDS) in a restricted bid. The financial opening took place on September 2, 2015. It revealed that Promising had made the lowest offer of 213 dollars a tonne.

The Bassiouni Group, which had been given an earlier contract in June 2015 to supply 200,000tn of wheat was also not able to deliver, with the PPPDS saying that its contract has now been cancelled, while the Group claims that it had decided to drop out while the tender was still in process, in an email response sent to Fortune.

When the PPPDS awarded the contract to Bassiouni Group, it also awarded Promising a contract for the supply of 40,000tn.

The Service is procuring 400,000tn for the entire 2015/16 fiscal year for distribution to factories and for public consumption. It had to cancel the first tender it had announced in March 2015. Then the June tender followed with an invitation for 13 companies.

With Bassiouni Group and Promising getting a contract for 240,000tn, the remaining 160,000tn was made available to the remaining 11 suppliers, if they could supply at 220.88 dollars a tonne, the same price as the two.

The contract for the supply of the 160,000tn eventually went to Promising and Hakan International, each supplying 80,000tn for the price of 222.09 dollars and 220.88 dollars, respectively.

The Bassiouni Group denied that its contract was canceled, in an email response to Fortune.

It “decided not to proceed further with the tender process – prior to any cancellation – due to differences over the provisioning of the Performance Bond. We made all of the necessary arrangements with our financial partners, wheat suppliers, logistics and shipping partners to fulfil the terms of the tender.

We also initiated the Performance Bond process with the appropriate entities. Unfortunately, we could not secure the full and necessary assurances for the Bond in line with our financial regulations and procedures. As a result we could not proceed further,” write David Bassiouni, managing director of the company, adding that the CEO of the company, Dr Bassiouni, had served in Ethiopia as Unicef representative.

Solomon Betre, procurement head at PPPDS, said that Bassiouni’s portion will be up for another tender.