Rice and wheat prices rise in central China

Rice prices were mostly up in Hubei province over the past week. Mid to late season rice was 2,634 yuan per ton, up 26 yuan per ton compared to the previous week.

The province also saw auctions of reserve rice, with 12,246 tons being purchased by the market. Mid to late season rice in those auctions saw prices rise 16 yuan per ton compared to pre-National Day holiday auctions.

Despite higher prices, wholesale prices remain relatively stable. Hubei’s Ministry of Agriculture notes that downstream traders and distributors are being more cautious about the higher prices because demand remains poor. Most downstream distributors are taking a “wait and see” attitude and avoiding accumulating large physical positions.

Wheat prices in province averaged 3,038 yuan per ton, up 10 yuan per ton compared to last week. Flour also rose to 3,728 yuan per ton, up 7 yuan compared to last week.

The strength is being attributed to strong results in the latest national reserve wheat auction. While it was a relatively small auction of wheat in Xinjiang, demand was higher than expected. Premiums were 526 yuan per ton higher than the auction minimum which was also higher than the market expected.