Zambia will be paying US$16 million more in the manufacturing of D-Compound fertiliser if the current company supplying the raw materials to the Nitrogen Chemicals of Zambia (NCZ) is going to be awarded the tender at an astronomical bid price of US$54 000 million for the supply and delivery of 64 000 tons of raw materials.
The less than transparent supplying of the raw materials to NCZ has been marred in fraudulent matrix in which different companies are procuring while only one is delivering.
The main company in the matrix is owned by a prominent lawyer.
Daily Nation sources revealed that the preferred company currently supplying raw materials to NCZ was at the end of the chain and that is why the final bid price for the tender that still remains cancelled having been inflated with an astronomical profit margin of about US$16 million.
Most of the stakeholders in the fertiliser procurement and supply business are shocked that the named company had continued to supply the raw materials even after the tender had not been officially awarded, having suffered two cancellations because of unexplained irregularities.
NCZ has the capacity of producing 10, 000 tons of D-Compound fertiliser per month but Zambia’s sole fertiliser manufacturing company is likely to fail to hit its target if the cartel that is determined have an expensive bidder whose bid price stands at US$54 million for the supply of 64, 000 tons should be awarded the tender. The sources fear that some government ministers who have established companies were fighting over the lucrative NCZ tender and that was why the tender had suffered two cancellations in no more than three weeks, the situation some stakeholders feel was likely to adversely affect the eventual distribution of the D-Compound to farmers.
The sources have challenged government and the NCZ tender committee to explicitly explain why the tender was being advertised and getting cancelled while time was running out for the optimum production of fertiliser.
The source said that the company that was currently supplying and delivering the raw materials had deliberately overpriced its bid because it was receiving the materials from another company which was importing the materials through Beira in Mozambique from the United Arab Emirates (UAE).
The officials from both NCZ and the Ministry of Agriculture said workers were not happy that the tender had been cancelled twice in just about three weeks and fear that the corruption that had characterized the supply of the raw materials would easily affect the operations of the institution.
“The question that begs the answer in this tendering process is why it is being advertised and getting cancelled. Time is running out and NCZ is supposed to be up and running but with what is currently happening, it is likely that the company may fail to meet its target of producing 100 000 tons by August unless they double the capacity to 30 000 tons per month from 10 000 tons,” the source said.
The officials cautioned that government risked losing US$16 million of tax payers money if the company that was currently supplying materials at an over-priced bid and advised that the people involved in the deal were sabotaging the production of D-Compound fertiliser.
It has also been learnt that the cartel had been planning their business long before NCZ thought of advertising the tender and that as early as February, the preferred company had already been identified and that the advertising was nothing but a formality.
“The materials are being sourced from a company called Agriculture Commodities, Dubai in the United Arab Emirates under a known company in Zambia which later supplies another in the chain.
The company that is supplied the raw materials is the one that supplies NCZ and this confirms the cartel in the matrix,’ the source said.