China plans to actively purchase wheat, and increase the imports of maize and soybeans
According to the market operators, China plans to purchase wheat batch of the US and Australian origin with delivery in April. Activation of trading activity on the grain market was caused by the desire of China to stock the grain volumes in the period of significant price fall on the market. So, to date the price for wheat fell to the lowest level during recent 3.5 years.
It should be noted that since mid-2013, China started actively purchasing foreign wheat because the domestic production of the grain significantly decreased, due to adverse weather conditions in the country. Generally, in 2013/14 MY the grain supplies to the country may exceed 9 mln tonnes, which will bring China to the leaders of the world imports of wheat.
Also, it is worth noting that China does not deny the future possibility of increasing the imports of maize and soybeans, required for meeting the growing demand for the reporting commodities on the domestic market. At the same time, China still plans to achieve the goal of grain self-production at the level of 90%.
In addition, the government of China decided to cancel acting of the system of state stocks of soybeans and cotton seed in some regions of the country in 2014, and introduce the system of "target prices", which should assist to control the prices of commodities on the domestic market and support agrarians. The government plans to compensate the difference between market and target prices to Chinese farmers.
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February 22, 14:00