China wheat prices mostly stable

Wheat prices in China's major producing areas were mostly stable in the week to Monday (Jan 11), with expectations for higher prices waning as flour sales were flat.

Prices in Dezhou in Shandong province were around RMB2,110-RMB2,120/tonne (US$309-US$311/tonne), the same level as the previous week.

In Zhengzhou in Henan province, prices were unchanged around RMB2,000/tonne (US$293/tonne).

Processing plants were not buying wheat actively as flour sales in some areas were not high during the usually strong consumption season. Nonetheless, heavy snowfall since the New Year holiday blocked transportation, which provided support to wheat prices.

The government sold 889,700 tonnes of wheat during its weekly sales, or 30% of the 2.99 million tonnes it offered to sell.

The volume has fallen for three consecutive weeks as most market participants do not expect wheat prices to change much in the near term, according to the Zhengzhou Grain Wholesale Market.

Analysts expect wheat prices to remain mostly stable heading toward the Chinese New Year holiday in mid February amid ample supplies, with flour sales expected to rise.