January 11, 2007

China sells 612,548 tonnes of wheat; prices stable

China sold 612,548 tonnes of wheat in six provinces Wednesday (Jan 10), the latest in a serious of auctions aimed at stabilising wheat prices.

The National Grain and Oil Trade Centre said it sold 473,400 tonnes, or 72 percent of its planned volume, at prices ranging from RMB1,400/tonne to RMB1,600/tonne.

Henan Grains Trading Centre sold 139,148 tonnes, or 40 percent of its planned volume, between RMB1,420/tonne and RMB1,630/tonne.

The prices are little changed from the last auction Friday, and are about the same as cash wheat prices in major producing regions.

The wheat was bought under the minimum purchase price by state warehouses last year.

China's central government designated state-owned warehouses in six major wheat growing provinces to buy wheat at minimum purchase prices of RMB1,380-1,440/tonne from June to September last year, hoping to protect farmers' incomes.

Grains trading centres in the provinces started selling the wheat in November to cap high cash prices due to a temporary tight supply.