Chinese government is likely to continue stockpiling new rapeseed, which is currently being harvested, at a higher price than last year to replenish falling vegetable oil reserves, analysts said on Wednesday. The China National Grain and Oils Information Center (CNGOIC) said the government is likely to pay farmers 4,600 yuan ($707.066) per tonne, 18 percent higher than last year's price to help boost farmers' income while reflecting their higher planting costs.
The projected price - equivalent to more than 10,000 yuan per tonne in terms of rapeseed oil - gave support to domestic futures prices of soyaoil and rapeseed oil which rose by more than 1 percent on Wednesday. Earlier, market traders had expected Beijing to suspend stockpiling this year's harvest due to concerns about rising food prices. To tame food prices, the government has sold a total of 1.32 million tonnes of rapeseed oil from state reserves at regular auctions since October and it has also sold 450,000 tonnes to some refineries that were required to freeze retail prices.
Comments
Comments are closed for this article.