October 31, 2006

 

China's Henan to auction imported wheat

 

 

China Zhengzhou Grain Wholesale Market said it would auction 354,000 tonnes of imported wheat from state reserves Tuesday (Oct 31) in what analysts say is an effort to fill a local shortage of high quality imported wheat.

 

The wheat on auction was imported from Canada and the US in 1999 and 2001, said Liu Junying, an official with Zhengzhou Grain Whole Market.

 

The state-owned China Zhengzhou Grain Wholesale Market, located in Henan province, a major wheat growing region in China, is the parent company of the Zhengzhou Commodity Exchange.

 

"Floor prices for the wheat to be auctioned would range from RMB1,900-RMB2,000/tonne ($242-$255/tonne), depending on the quality," she added.

 

The auction aims to increase supplies of high quality wheat to the market, analysts said.

 

"Supplies of imported wheat, usually better in quality than Chinese wheat, are tight, as wheat imports dived this year, with prices soaring in the international market." said Hai Yang, an analyst at Zhengzhou Esunny Information Technology Co.

 

China imported 471,670 tonnes of wheat January-September, down 85.2 percent  on year, according to Chinese Customs.

 

"More such auctions are expected, as wheat imports would continue to fall over the next couple of months," she added.

 

Prices of imported wheat are quoted around RMB2,450/tonne at major Chinese ports this week.

 

Meanwhile, Henan and Anhui, another wheat producing province, plan Friday to auction 500,000 tonnes of Chinese wheat harvested this summer, said local traders.