Country also thought to be refilling state wheat reserves and dealing with quality concerns in some regions
BEIJING, China (Reuters) — China bought as much as 650,000 tonnes of U.S. wheat last week prompted by falling prices, a government think-tank said.
This was the second large-scale purchase of U.S. wheat by the world’s top wheat producer this year, bringing its total buying to about 1.5 million tonnes, said the China National Grain and Oils Information Centre (CNGOIC).
The latest U.S. wheat was bought at $320 to $328 per tonne CIF (cost, insurance, freight) for delivery from July to September. The U.S. price was about 11.6 percent cheaper than Chinese wheat, said the centre.
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Beijing is refilling its depleted state wheat reserves, while the quality of some state-owned wheat is also deteriorating. Traders said Sino grain, the state stockpiler that made the purchases, was looking for another two-three million tonnes.
The U.S. Department of Agriculture confirmed May 24 that only 180,000 tonnes of U.S. soft red winter wheat were sold to China, but traders expected more to be announced.
Chicago Board of Trade wheat fell to a more than one-month low last week following forecasts for rain in some U.S. growing areas.
The CNGOIC reported last month that China bought 14 to 16 cargoes of U.S. soft red winter wheat, which the USDA later confirmed.
China expects its wheat harvest, due in June, to rise only 1.5 percent to 116.5 million tonnes after bad weather damaged crops in some areas, analysts said.
Beijing’s 2013 minimum wheat purchase price is $370 per tonne.
