January 12, 2011

China sells 164,265 tonnes of auction corn

China sold 164,265 out of 1.77 million tonnes of corn offered from state reserves at auctions on Tuesday (Jan 11), the China National Grain and Oil Information Center said.

The average price was RMB1,876/tonne (US$283.68), down from about RMB1,894/tonne (US$286.41) last week, when the government sold 228,503 tonnes of corn.

Another auction Tuesday (Jan 11), of 296,400 tonnes of soy from the central government reserves, failed to attract any bids, the CNGOIC said.

The first soy auction by the central government this year failed to attract any bids due to ample supply and what was considered a high floor price, analysts said. An auction last Friday (Jan 7) of 191,517 tonnes from Heilongjiang's provincial reserves also failed to attract any bids.

The government will sell 4.5 million tonnes of wheat Wednesday (Jan 12).

There are also market rumours that China will sell 500,000 tonnes of rapeseed oil to major edible oil companies including Cofco Group, Yihai Kerry Investment Co. and Chinatex Corp.

But an official from Chinatex said that his company has yet to receive any such notice from the government; he did not elaborate.

Edible oil prices recently reached their highest levels since July 2008 due to excessive liquidity and strong demand ahead of the Lunar New Year.

They exceeded levels recorded in mid-November when the government introduced a flurry of tightening measures as a result of surging food prices.