ISLAMABAD Trading Corporation of Pakistan (TCP) has cancelled the awarded contract of import of 100,000 MT of sugar by a Chinese firm, M/s. Yunnan Coal Chemical Industry Group Co Ltd after confirming non-availability of sugar and failure to nominate the ship. According to the Trading Corporation of Pakistan (TCP), the Executive Committee of the Board of Directors (ECB) in its special meeting has cancelled the contract awarded to M/s. Yunnan Coal Chemical Industry Group Co. Ltd. for import of 100,000 MT of sugar. The said contract was awarded to the firm after exercising due diligence for their pre-qualification and strictly following the PPRA Rules awarded contract to the lowest bidder. The firm deposited performance guarantee valuing $976,000 and was required to make first shipment within three weeks of the opening of L/C. The contract also stipulates that the seller can avail 10 days beyond three weeks on payment of penalty of $0.1 per day per ton. The firm after availing this period, which expired on mid night of Friday, has failed to honour contract terms. Further, it has been learned that TCP after obtaining independent report from the Pre-shipment Inspection Agency (SGS) from Brazil confirming non-availability of sugar by the party and failure to nominate the ship cancelled the contract of M/s. Yunnan Coal Chemical Industry Group Co Ltd. However, the other contract with M/s. Sadat Business Group Ltd, Dubai for 50,000 MT will expire today (July 18) as the bank took two additional days for processing of L/C. The firm has requested for extension up to 30th July 2010 due to serious port congestion at Santos, Brazil. The Pre-shipment Company (NMCI) has confirmed that the sugar is available but could not be delivered due to bad weather in Brazil. Pakistan Embassy in Brazil has also confirmed the same. Moreover, the Managing Committee, considering all aspects including PSI report and Pakistan Embassy report confirming port difficulties, has decided to grant extension till 30th July, 2010 with nomination of ship by 22nd July, 2010 positively failing which, the contract will be cancelled. Again, it is pertinent to mention here that the TCP further clarified that the subject quantities were not included in its delivery schedule till Ramazan. TCP has, so far, received 264,111 MT of sugar and will have arrivals of around 333,000 MT of sugar by September 2010 for delivery to Utility Stores Corporation (USC) and Canteen Store Departments (CSDs). The quantity cancelled will be covered under the two tenders already floated in the market to be opened on 31st July and 7th August 2010. Therefore, TCPs delivery schedule for USC and CSDs will not be affected with the cancellation of these contracts.