After discarding steel procurement worth of some three billion birr in April, the Addis Ababa Saving House Development Enterprise recently awarded a local manufacturer to supply close to 126 million kilograms or 126,000 tons of steel valued at some 2.2 billion birr.
Telku Beyamo, deputy head of the enterprise told The Reporter that the previous bid was cancelled following the declining prices in the international markets for steel. According to Teklu, the decline in the price of steel has prompted the enterprise to suspend previously staged bids. He said that some 320 million birr has been saved due to the price decline. That in turn enabled the enterprise to revise the quantity of steel by adding 70,000 tons against the previous 150,000. Back in March, the price of steel in the international markets was around 90 dollars per ton which was some 295 dollars in 2015.
Hence, undisclosed reports suggested that C & E Brothers Steel Factory has won the bid providing the least price out of the five contenders. Hence, the company is expected to supply the rages of 10mm to 20mm sized reinforcement bras. The enterprise indicated that Chinese East Steel, Abyssinia Integrated Steel PLC, Habesha Steel and Steely RMI have taken part in the bid process. Next to C & E Brothers, East Steel is awarded to supply 39.4 thousand tons of steel that is valued at some 718 million birr. Steely RMI is expected to supply the remaining 45.9 thousand tons worth of 832 million birr.
The total amount of cost the enterprise expected to purchase was some 220,000 tons of steel reaching some 3.6 billion birr. However, in the previous bid, it was East Steel that clutched major size of the purchase, the company was awarded to supply some 124,000 tons of steel with 2.4 billion birr.
It is to be recalled that international bidders were barred from taking part in the process following a new directive introduced by the Office of the Prime Minister to encourage or incentivize local steel manufacturers; a move that violates existing procurement laws. Any purchase that surpasses some three million birr is prearranged to be floated to the international bidders.