KARACHI, Feb 6: State-run Pakistan Agriculture Storage and Supplies Corporation (Passco) has cancelled a tender to import 150,000 tons of milling wheat following a review of domestic supplies, an official said on Friday.

"Yes we have scrapped the tender and also returned the documents to the bidders," a Passco official said, speaking on condition of anonymity. "We have informed the bidders."

Passco had sought to buy the wheat through a tender issued on January 18, for February shipment on a C&F basis. The official told Reuters the government had no immediate plans to re-issue the tender.

"The government is monitoring supplies of wheat in the (domestic) market, which is normal and any new tender will be issued if there is any shortfall." The official said the tender was cancelled on the order of Prime Minister Zafarullah Khan Jamali after reports that Pakistan had stocks of at least two million tons of wheat.

The official said the decision to cancel followed an assessment by the agriculture ministry that two million tons of wheat were available in the market while 150,000 tons of grain from Australia are due in Pakistan in the third week of February.

"The stocks of over two million tons can easily meet demand until March when supplies from the new crop will start," he said.

Pakistan had received six bids at the tender and Passco shortlisted four potential bidders - three Australian and one Southeast Asian. The offered prices were between $200 and $233 per ton C&F.

Pakistan announced plans last year to import about 500,000 tons of wheat, saying it needed to fill a shortfall and build strategic reserves after grain production fell short of the target in the 2002-03 (Nov-April) crop year due to bad weather.

Pakistan's wheat output was about 19.25m tons in the 2002-03 crop year against a target of 19.70m. Its annual consumption is around 20m tons. -Reuters