Catalogue material issue

Hi,

I have uploaded a catalogue and am trying to create a SHC with reference to a material in this catalogue. This material is a backend material. I am getting the error "This material does not exist or is flagged for deletion".

I have checked the R3 and the material master is correct.

Another strange thing is that this material is available for sleection in SHC through "Internal Goods and Services" as well and when i create the SHC using "Internal goods and Services" using the same material, it works absolutely fine. Can anyone please help?