June 9, 2009
China wheat prices lower amid harvest; supply to rise
China's wheat prices in the major producing areas were slightly lower in the week to Monday (June 8) on supply concerns amid the ongoing harvest.
Wheat prices in Xinyang in Henan province were RMB1,760 to RMB1,780 a tonne, down RMB10 to RMB20 from a week ago.
Wheat prices in Suzhou in Anhui province were RMB1,780 to RMB1,800/ton, also down RMB10 to RMB20 from a week ago.
China started its wheat harvest in late May, and small volumes of new wheat are being sold in the market.
However, purchasers weren't buying actively due to low wheat processing margins.
Sluggish wheat flour demand is unlikely to boost profits in the near term, said China National Grain and Oils Information Centre in its note.
Analysts expect new wheat prices to be significantly lower versus last year, adding however the minimum purchase prices later will be supportive.
The wheat harvest has been affected by rains in major producing areas and the quality is general worse than last year, with some of the wheat unfit to produce food, said Hai Yang, an analyst with Zhengzhou Esunny Information & Technology Co.
