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China auctions 4 million tonnes of grain reserves

China has auctioned 4.34 m tonnes of its grain reserves since November in a bid to arrest the rising prices on the domestic market.

india Updated: Dec 23, 2006 12:04 IST

China has auctioned 4.34 million tonnes of its grain reserves since November in a bid to arrest the rising prices on the domestic market.

China is auctioning its wheat reserves for the sixth time since November in Zhengzhou, the capital of Central China's Henan Province, officials with the China Grain reserves Corporation (CGRC) said.

The CGRC said it purchased 40.7 million tonnes from June to September to fill state reserves and to reinforce the country's ability to regulate wheat prices.

A CGRC spokesman said around 500 to 600 grain processing firms joined the auction and the supply and demand generally remained balanced.

The move came after grain prices rose in November. Figures with the National Bureau of Statistics show that the price of grain products rose 4.7 per cent last month.

The government will intervene in the market periodically by selling grain reserves with the Lunar New Year, the most important festival for Chinese, approaching when more flour is consumed.

First Published: Dec 23, 2006 12:04 IST