India's MMTC DAP fertilizer tender lapses

05 September 2007 15:51  [Source: ICIS news]

LONDON (ICIS news)--India’s MMTC has once again failed to secure any phosphate fertilizer under its latest tender, a trader said on Wednesday.

 

The latest tender, for 50-70,000 tonnes of diammonium phosphate (DAP) that closed on 27 August was thought to have lapsed with no business concluded and some traders speculating that no serious offers were made.

 

India’s largest public sector enterprise company similarly failed to receive any offers under its tender that closed 10 August for 150,000 tonnes of DAP.

 

The trader source seriously doubted whether MMTC was able to add any value in the DAP purchasing process given that other government agencies, most notably Indian Potash Limited (IPL) were able to deal directly with international producers and traders, rather than through MMTC itself. 

 

The trader speculated that it appeared unlikely that MMTC would issue any further DAP fertilizer tenders in the near term.

 

Longer term, the trader said that MMTC “seriously needed to re-examine its business model,” when it came to fertilizer importation.

 

However, the source added that the company could still take advantage of the credibility it enjoyed when it came to its financial viability and the perceived value of its letters of credit as a trusted and reliable buyer of imported fertilizers.

 

The source added that MMTC still had the ear of the government, but it needed to get to grips with the “new paradigm” of international phosphate fertilizer trade.

By: Mike Nash
+44 20 8652 3214

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