Contractors say they are unable to meet tender terms as palm olein prices have skyrocketed due to the Russia-Ukraine crisis
Contractors say they are unable to meet tender terms as palm olein prices have skyrocketed due to the Russia-Ukraine crisis
The Madras High Court on Friday reserved orders in a number of cases brought by state contractors expressing their inability to supply additional quantities of palm olein at old prices to the Tamil Nadu State Civil Supplies Corporation (TNCSC). , since prices have risen sharply commodity after the Russia-Ukraine crisis.
Judge GR Swaminathan deferred judgment on the charge after hearing Attorney General R. Shunmugasundaram for TNCSC and Senior Counsel AL Somayaji and ARL Sundaresan for various contractors who feared the company could blacklist them if they did the additional Do not deliver quantity at old prices.
In his affidavit, Suresh Gattreddi, partner at Starshine Logistics, based in Chennai, said the company is engaged in logistics and trading of food products such as legumes, cooking oils and sugar. It had also obtained an importer-exporter code for the purpose of importing and exporting the food products.
On 20 December, TNCSC solicited bids for the supply of 400 lakh sachets (one liter each) of palm olein and the petitioner won the tender for the supply of 65 lakh sachets in January at a negotiated price of £120.25 each . The first tranche of 32.50 lakh sachets was delivered before February 21st and the second before March 28th.
Because Clause 17(d) of the RFP Notice authorizes the TNCSC to change the final quantity by 25% in either direction of the request, the company emailed the petitioner on March 2nd instructing it to add an additional quantity from 16.25 lakh pouches to be delivered on or before 3 May at the agreed price of ₹120.25 per pouch.
However, the applicant company expressed its inability to make such an additional offer as the international price for palm olein had risen from US$1,575 per tonne on February 22nd to US$2,000 on March 3rd. The increase was attributed to strong demand for palm olein due to export bans on sunflower oil from Russia and Ukraine.
Faced with the risk of being blacklisted and not being allowed to participate in future tenders if it does not meet the tender condition of supplying 25% of the additional quantity at the agreed price, the petitioner asked the court to Order canceled by TNCSC for delivery 16.25 lakh bag of palm olein.
