China wheat mostly stable; prices up in some areas supply

 

 

Wheat prices in China's major producing areas were mostly stable in the week to Monday (August 3), with prices up in some areas on tightening supply.

 

Prices in major producer Shijiazhuang province were between RMB1,900 (US$254.70) to RMB1,920 (US$281.04) a tonne, stable from a week ago.

 

Prices in Henan province were between RMB1,740 to RMB2,070/tonne, up RMB10 from a week earlier.

 

Dwindling new wheat supply helped support market prices, while wheat flour processing plants are unwilling to raise their bids due to low flour demand.

 

The government's weekly auctions also guaranteed wheat supply, and processing plants aren't competing for the crop.

 

As wheat prices stabilized, farmers also increased their sales volume on concerns over a possible fall in prices, preventing a further rise in prices, said a local analyst.

 

Last week, the government sold 250,700 tonnes of wheat it bought at minimum purchase prices in earlier years, down 9,400 tonnes from the previous week and 17 percent of the 1.5 million tonnes it planned to sell.

 

The average price was RMB1,798/tonne, up RMB3/tonne from a week earlier.

 

As wheat flour demand will remain sluggish amid the weak consumption period, wheat prices are likely to remain stable in the near term, said analysts.

 

US$1 = RMB6.83 (Aug 3)