The unnamed winning bidder to replace Clyde Bridge on Pettinain Road, near Carstairs Junction, withdrew its tender blaming steel and cement cost inflation.
The 90m steel bridge replacement for a weakened concrete structure was originally tendered with a £3.8m cost estimate by the council.
Clyde Bridge had to be closed in late 2018 after significant defects were picked up during a routine inspection.
Despite unavoidable delays, the council has repeatedly committed to replacing the bridge, and just last month identified additional £1.6m funding to keep the project on track despite increasing costs and global supply issues.
This allowed the project to progress to the next stage of the tender award process, but at that point the contractor that had prepared the winning bid indicated it was unable to deliver the project within the tender price.
Following legal advice on how to proceed, the second-ranked contractor was then approached to see if it would maintain its tender bid, but that firm confirmed it was also unable to maintain its tender price.
Colin Park, Head of Roads and Transportation, said that this meant the council has been unable to award the contract under the existing tender process, with alternative ways to deliver the new bridge now actively being sought.
He said: “I understand that this will be deeply disappointing news to local people. We share that disappointment as we had thought we were on the brink of proceeding with this much-needed project.
“However, we remain committed to replacing Clyde Bridge as soon as possible. The council is urgently considering the options for an alternative procurement route to deliver the bridge at the earliest opportunity.”