Economy

Farmers reluctant to sell as wheat prices soar

(Xinhua)
Updated: 2010-07-07 14:54

As of June 15, China's main wheat producing areas had altogether purchased nearly 2.94 million tones of wheat, which was 4.61 million tons less than the same period last year, according to statistics from the State Administration of Grain.

One reason for the drastic purchase fall is that the cold weather had deferred the time for ripening and the reaping was also postponed by the rainy weather, according to Zhang Rongsheng, a Xinhua analyst.

Meanwhile, some grain brokers have also hoarded grain for later sale.

However, China is totally capable of regulating wheat prices as it has a large amount of grain reserves, said Zhang.

Eventually, hoarders would get hurt, he said.

Meanwhile, he also advised farmers not to store grain, as they usually don't have professional storage facilities, which might hurt the quality of their wheat.

Related readings:  Wheat declines amid demand concerns  Race for wheat harvest in central China  China wheat output may be flat at 110m tons  China to raise minimum purchase price for wheat in 2010

The Grain Administration of Jiangsu province has already sent inspection panels to supervise the grain purchase markets, asking companies to stay clear-minded and purchase at reasonable prices.

Despite challenges posted by the extreme weather, China's Ministry of Agriculture (MOA) said in June that China's harvest of summer grain crops this year is still pending, with the output predicted to approach the same level as last year.

In April the government unveiled funding plans worth more than 2.4 billion yuan to ensure summer grain output, which accounts for about one quarter of its annual food yield, according to the MOA.

China's summer grain output rose six years in a row to top 123.35 million tons last year, 2.6 million tons more than the previous year. The total grain output reached 530.8 million tons last year, the sixth consecutive year of growth.