Economy

Overseas grain purchasing agencies covet China's markets

By Zhao Chunzhe (chinadaily.com.cn)
Updated: 2010-07-07 17:12

Many of China's domestic grain purchasing agencies felt slighted by highly capitalized overseas purchasing groups in China's major wheat belts, xinhuanet.com reported today.

Some sources even worried that it will affect the central government's regulation of grain price.

"The state's grain purchasing process slowed this year, with less than 7,000 tons of grain per day," said Liu Daofu, head of state-owned Jining depot.

Besides the bad weather factors, the foreign purchasing groups tempted the Chinese peasants with higher purchase price which made them store the grain and wait for the better bid.

"The foreign-funded Yihai Kerry Agribusiness Company made a budget of US$88.5 million in Jining, East China's Shandong province, which could buy 300,000 tons of grain. It seems the company cares less for the profits and more for the control of the purchasing price in China," an unnamed source said.

However, the Yihai Kerry said the company's behaviors comply with China's law and didn't raise the grain price on purpose, the reports said.

"I am not selling my wheat now. I bet it will appreciate," said Shao Changyi, a farmer in Shandong, China's second biggest wheat belt.