China wheat prices fall slightly as harvesting in full swing

 

 

Wheat prices in China's major producing regions fell slightly in the week to Monday (June 15), as more than half of the new crop has been harvested and some new wheat has already reached the market.

 

Wheat prices in Dezhou in Shandong, a major producing province, were at RMB1,880 a metric ton, down RMB10/tonne from a week ago.

 

Prices in Buyang, in Anhui province, were down RMB20/tonne, at RMB1,680/tonne.

 

In Hengshui, in Hebei province, prices were around RMB1,940/tonne, largely the same as a week ago.

 

China's National Grain and Oils Information Centre, an industry think-tank, on Friday kept its 2009 wheat output projection mostly unchanged at 113.2 million tonnes and 24 million hectares.

 

"Prices are down slightly, mostly because harvesting has started and volumes are estimated to be pretty good," said Hai Yang, an analyst at Zhengzhou Esunny Information & Technology Co.

 

Farmers initially feared drought-related problems would affect this year's supply, but those concerns have largely faded, Hai said.

 

A bout of rain in Hubei and southern portions of Henan provinces also reportedly damaged some crops, Hai said, but didn't appear to have affected overall estimates much.

 

At auctions of the old crop, average prices were higher.

 

The average auction price in Henan province was RMB1,809/tonne, up RMB4 from the previous week.

 

In Anhui province, the average auction price was RMB1,823/tonne, up RMB3 compared to a week ago.

 

Wheat flour demand is widely expected to stay relatively weak this year, but the government is supporting prices with its 2009 wheat purchase program at a minimum RMB1,740/tonne.