Authorities at the federal government were forced to cancel an international bid to buy wheat deemed crucial to stabilise the market and provide welfare to low-income groups.

The only bidder that offered prices to supply 400,000tn of wheat, Promising International, has failed to meet a technical requirement. Another bid for a similar volume, floated by the United Nations Office for Project Services (UNOPS) earlier this month, had also been scrapped due to what insiders say is a "shift in priorities," although it was re-floated earlier this week.

A major setback for the authorities, the latest failure to ensure timely supplies of wheat undermines efforts to meet the growing demand due to a surge in the number of people who need emergency humanitarian assistance, people following the case fear. As many as 23.8 million people across Ethiopia will require emergency humanitarian assistance through September this year, according to an estimate made by USAID.

The first bid was floated in March this year as part of a special procurement move to buy wheat, rice and sugar. Only one company of the 57 interested bidders, Promising International, responded as the requirements include an agreement by the supplier to repatriate the revenues from the sales between two and five years. A committee comprising officials from the ministries of Trade & Industry and Finance, the Ethiopian Trading Businesses Corporation, and Public Procurement & Property Disposal Service (PPPDS) was formed to follow up the procurement process.

"The tender has been cancelled as the bidders didn't meet the technical criteria," said Tsewaye Muluneh, director-general of the Public Procurement & Property Disposal Services (PPPDS).

A technical mishap from Promising International was partly to blame for the cancellation of the bid. A bank guarantee for half a million Birr, which should have been enclosed with financial documents, was mistakenly enclosed in the technical document, said Habtamu Million, a local representative of the Dubai-based trading house.

Promising International has a long history of disputes with Ethiopian authorities over unsuccessful bids floated to buy wheat.

Officials from the Ministry of Trade & Industry did not respond to questions about what is to come next in the procurement process, despite repeated attempts from Fortune.