August 26, 2010

Japan to raise wheat selling price

Japan will increase prices of imported wheat for sales to domestic flour millers by 1% on average in October, the first increase in two years, after Chicago futures surged on Russia's export ban.

Prices of foreign milling wheat will increase to JPY47,860 (US$566.87) per tonne on average starting October 1, depending on the brand of the grain, the Ministry of Agriculture, Forestry and Fisheries said. This is the first increase since October 2008, adding to costs for Nisshin Seifun Group Inc., Japan's biggest flour miller, as well as rivals including Nippon Flour Mills Co.

Japan, which depends on imports for almost 90% of its wheat, buys the grain exclusively from the US, Canada and Australia through state tenders. The ministry, which controls overseas purchases and domestic sales to stabilise supply, is Asia's largest wheat buyer as a single entity.