February 1, 2011

China to resume grain, oils auctions after holiday

China will suspend its weekly auctions of grain and oils reserves during Lunar New Year holiday (February 1-10), and will resume the sales of corn, rapeseed oil, wheat and paddy rice from February 15.

The corn and rapeseed auctions will be arranged on February 15, while wheat and paddy rice auctions will be held on February 16 and 17, respectively, the National Grain & Oil Information Centre (CNGOIC) said.

Since October of last year, the government has sold out 680,000 tonnes of rapeseed oil from state reserves at six auctions, or 85.5% of the 795,400 tonnes it planned to sell.

Boosted by pre-holiday consumption and rising prices of edible oil, rapeseed oil sales has improved significantly at recent auction, and has positive effects in stabilising market prices.

China has released 1.46 million tonnes of soy reserves from December, but only 5,000 tonnes, or 0.34% of the total, were sold mainly due to unappealing floor prices and lower oil yield of reserve soy compared with new soy produced in crop year of 2009/10.

Meanwhile, the government had purchased 38.76 million tonnes of new corn in domestic major producing provinces and regions by January 20, with state grain firms' purchases at 9.89 million tonnes, or 26% of the total.

CNGOIC earlier said in its January forecast report that China's corn output in 2010 would reach 172.5 million tonnes, representing a rise of 5% over a year earlier.