Saturday, April 13, 2024

US Company – Osirius Group wins latest sugar bid


A USA based company receives a nod from the Ethiopian Sugar Industry Group to supply 200,000 metric tons of sugar, in the latest restricted bid.
From Capital’s reporting in recent weeks, the latest restricted bid that was opened on November 8 sees Osirius Group winning the bid over Agrocorp International and ED and F MAN who also produced technical and financial document for the bid.
The recent restricted bid was re-floated following the failure of the South African company, Millhouse International, which was awarded the bid to supply 200,000 metric tons of sugar, but fell short due to failure in coming up with a performance bond.
In the recent bidding, Osirius offered a highly competitive rate for the supply of the sweat, while the offer put in by Agrocorp was a bid higher for the supply of the strategic commodity on payment at sight whereas the offer of ED and F MAN was noted to be incomparable with the rate that the US firm tabled.
About two weeks ago, the Sugar Group called for the three companies to extend their price validity date for additional seven days of up to November 29 besides the original ten days that was mentioned on the bid documents.
As per the information Capital obtained from reliable sources, both ED and F MAN and Osirius accepted the extension.
According to the information heard this week, the Group has awarded the US based company to supply the commodity as per the schedule that the two sides agree upon.
In the bid documents, the Group expressed its desire for the commodity to be transported up to Djibouti through eight shipments at 25,000 metric tons each. However it has been stated that the first batch was expected to reach on the third week of November and the last one at the end of January 2023. However, there will be some adjustments on the arrival as experts opine.
On the FOB price offer, Osirius stated that it will supply the commodity on letter of credit (LC) at sight USD 545 per ton, USD 522 on 12 months differed LC and 18 months differed LC that means the payment will be settled in a year and half time. The bid winner cited that the loading port will be at Brazil.
The Singaporean company, Agrocorp, which is the company that won the last sugar bid which was opened more than a year ago, gave its offer on LC at sight and differed LC for 12 months. Based on that it offered USD 549.95 for payment at sight and 608.75 for 12 months differed LC.
ED and F Man- a British commodity firm, which is not a fresh face to Ethiopian markets offered USD 850, USD 900 and USD 1,100 per ton for payment at sight, 12 months and 18 differed LC respectively.
As per the information Capital secured, the Group has accepted the 12 months differed LC that Osirius offered to supply the sugar.
The offer that the company submitted for 12 months differed LC was lower by USD 23 than its offer for payment at sight. “Due to that the Group selected the 12 months differed LC,” the sector experts said.
“If the company maintains commitment to its words, the sugar shortage will be easily solved. However, if it disappears like Millhouse, then the Group must reassess its international bidding scheme,” experts added.
The awarded company is expected to come up with its performance bond by this coming week.
In the 2021/22 budget year, the Group had floated an international bid, but was unable to buy the commodity in the year.

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