Mumbai: The government has decided to cancel the import tender floated for 1 million tonnes of wheat, citing high prices quoted by global suppliers. It also extended wheat procurement period in Punjab and Haryana.

"We have decided to cancel the tender as the price of $263 per tonne quoted by the bidder is high considering that the international prices are expected to soften following hopes of high global output," a senior food ministry official said.

The State Trading Corporation, which floated the tender, had received seven bids from international trading firms at between $265.50 and $296 per tonne - about a fifth more than what the country paid last year.

STC negotiated with bidders Glencore and Toepfer to bring down the lowest price offered to $263 per tonne for 300,000 tonnes of wheat, traders and officials said.

The proposal, however, has been shot down by the food ministry.

The imports were meant to bridge the gap in local procurement.

The country imported 55 lakh tonnes of the foodgrain last year, after a six-year gap, to augment stocks for distribution under public distribution system (PDS).

Out of the total procurement target of 151 lakh tonnes, 104 lakh tonnes were procured as of May 29. As much as 93,111 tonnes of wheat was procured on that day itself.

Buoyed by the trend, the government has decided to extend the period for wheat procurement and the bonus of Rs100 per tonne by 15 days till June 15 for the main suppliers - Punjab and Haryana.

Though the wheat procurement is expected to fall short of the target, the reports of stock holding by farmers on expectations of higher prices has brought hopes of larger than expected purchase for the ration shops.