December 15, 2006

 

China sells 832,800 tonnes wheat at prices lower than spot market

 

 

China sold a total of 832,800 tonnes of wheat through public auctions Thursday (Dec 14) at prices slightly lower than the cash values, according to the auctioneers.

 

The Anhui Grain Wholesale Market and Hebei Grains & Oils Wholesale Centre jointly sold 570,800 tonnes of wheat stored in warehouses in five provinces, at average prices ranging from RMB1,440-1,572/tonne.

 

The Zhengzhou Grains Wholesale Market sold 262,000 tonnes at an average price of RMB1,504/tonne.

 

A total of one million tonnes of wheat was planned to be sold through the auctions.

 

The wheat was bought by the government warehouses at minimum purchase prices earlier this year.

 

To protect farmers' incomes, China's central government designated state-owned warehouses in six major wheat growing provinces to buy wheat at minimum purchase prices of RMB1,380-1,440/tonne from June to September.

 

Prices of average-quality wheat in major producing regions, such as Henan, Shandong and Hebei provinces, are now quoted at RMB1,520-1,580/tonne.

 

China issued rules last Thursday, saying that auctions of grains from interim state reserves will be held on a regular basis in order to ensure price stability.

 

Interim state reserves refer to grains bought under the government's minimum purchase price programme and grains imported by the country.

 

A total of 635,671 tonnes of wheat was sold through similar auctions last Thursday.