May 29, 2008

China's corn prices higher as farmers hold back stocks

China's corn prices were slightly higher in major producing regions in the week to Wednesday, as farmers were reluctant to sell.

Corn prices in Changchun city in Jilin province were between RMB1,600 and RMB1,620 a tonne, up RMB20-RMB30/ton from a week earlier.

Corn prices in Shijiazhuang city in Hebei province were around RMB1,630/ton, stable from the week before.

Industrial processing plants ran at full capacity while farmers held off on selling large volumes, anticipating higher prices, said Wang Shiliang, an analyst at Jilin Grains Centre.

Corn prices in consumption areas were also higher, in tandem with the gain in producing regions.

Corn prices in Wuhan city in Hubei province were around RMB1,880/ton, up RMB60/ton.

The government sold 160,890 tonnes of corn from its state reserves Tuesday, or 40.7 percent of the 394,909 tonnes it planned to sell.

China's corn prices are likely to consolidate within a narrow range in the near term as the government plans to guarantee stable grain prices through increased sales of corn reserves in Sichuan province and major consuming Guangdong province, the China Food Industry Network said.