July 29, 2008
China wheat prices slightly up amid strong buying interests
China's wheat prices were mostly higher in the week to Monday (July 28), as processing plants were willing to pay a higher price to meet an expected increase in demand.
White wheat prices in Dezhou in Shandong, a major producing province, were between RMB1,680-RMB1,740 a tonne, up RMB10-20/tonne from a week ago.
White wheat prices in Shijiazhuang in Hebei province were at around RMB1,720/tonne, up RMB10/tonne.
Red wheat prices in Huazhong Grain Sales Market in Hubei province were at around RMB1,520/tonne, unchanged.
Wheat traders were buying actively on expectations of increasing demand, and farmers were willing to sell on the high prices, said China Zhengzhou Grain Wholesale Market, a state-owned trading center.
Wheat prices are likely to rise further as many grain farmers preferred to hold some of their harvest to watch for future price directions, analysts said. Any fall in prices may make them reluctant to sell, they said.
Meanwhile, demand for wheat is likely to pick up with summer, which is a weak consumption season, nearing an end, they added.
Last week, the government sold 686,600 tonnes of wheat it bought under the minimum purchase prices programme, or 88 percent of the 778,700 tonnes it planned to sell. The average price was RMB1,598/tonne, up RMB45/tonne from a week ago.
The government also sold 3,214 tonnes of imported wheat from reserves, or 0.36 percent of the 881,387 tonnes it planned to sell.
US$1 = RMB6.8266 as of July 29, 2008