Grain merchants bet on the lowest purchase price of wheat this year: the price has risen eight times in a row.

The lowest purchase price for wheat in 2015 is 118 yuan per 50 kilograms (1.18 yuan per catty), keeping the 2014 level unchanged, according to the National Development and Reform Commission.

As soon as the news was announced, grain traders who were hoarding wheat at high prices were shocked. An industry insider told China Business Daily that traders in some places offered more than 1.3 yuan to buy wheat. It was a bet that wheat prices would rise in the new year. I didn't expect this bet was wrong.

Since 2007, the minimum purchase price of wheat (white wheat, third-class) has risen from 0.72 yuan per jin to 1.18 yuan per jin in 2014. In order to protect the growth of farmers' income and enhance farmers' enthusiasm for planting, the state has been raising the minimum purchase price, and the unilateral rise in wheat prices has almost become a consensus in the market.

Industry insiders say that the minimum purchase price of wheat will not be raised next year, which seems to be unexpected, but in fact it is reasonable.

According to the latest research report released by the USDA in October, China's wheat production is expected to reach 126 million tons in the 2014 market year, an increase of 4 million tons compared with about 122 million tons in 2013. In terms of inventory, the USDA estimates that China's wheat ending inventory will reach about 63.27 million tons in 2014, an increase of about 3 million tons over the previous year.

A person from a large flour processing company said that the domestic grain harvest has been bumper in recent years, but the domestic economic growth has slowed recently, the demand for food, including grain, has weakened, and the country has abundant grain in its hands. It is less necessary to continue to raise prices to buy wheat.

China has already achieved 10 consecutive grain growth, the state has purchased wheat and rice at the lowest purchase price, and temporary storage of corn, soybeans and rapeseed, and a large number of agricultural products have entered the granary of the China Grain Reserve Management Corporation (China Grain Storage). The capacity of the medium grain warehouse is saturated.

Since the beginning of this year, as of September 20, the China National Grain Storage Corporation has completed the purchase of 25.34 million tons of wheat and 3.88 million tons of early rice, the Economic Daily reported. At present, the northeast and other major grain producing areas are about to enter the warehouse. In order to free up the storage capacity, the relevant state departments have issued three batches of inter-provincial grain transfer plans, arranging for Heilongjiang, Jilin, and Inner Mongolia to produce 9.5 million tons of temporary storage corn in 2013, and to transfer 500000 tons of rice at the lowest purchase price in Jiangxi and Hunan in 2013. As of September 25, 5.3097 million tons of grain have been shipped to inter-provincial warehouses, and more than half of the transfer plan has been completed, making progress faster than ever before.

The operational Bureau of the National Development and Reform Commission recently organized the fifth grain transportation coordination meeting, requiring the parties concerned to continue to strengthen cooperation, overcome difficulties, speed up progress, and strive to complete the task of grain transportation.

Market participants believe that in addition to continuous bumper harvests and tight storage capacity, wheat prices have risen year after year, coupled with rising labor costs, grain processing enterprises are becoming more and more unbearable. A person from Wudeli Group, which has the largest flour processing capacity in China, told China Business Daily that about 10 years ago, it made a profit of 1 yuan to 2 yuan for selling a bag of flour, but now only a small number of enterprises can earn a profit of 1 yuan per bag of flour. Many enterprises only make a profit of 0.5 yuan per bag of flour, and some even lose money.

The operating rate of many flour processing enterprises is insufficient, generally only 50% to 60%, and the low is only 30%. Industry insiders said that after the NDRC announced that the minimum purchase price for wheat would not be raised in 2015, the purchase price of Mai Lang and other enterprises in some northern areas was reduced from 1.3 yuan per catty to 1.28 yuan per catty. The fact that the price of wheat does not rise is a good thing for processing enterprises. apart from reducing costs and improving profit performance, the key is to stabilize the expectations of enterprises. before that, it is difficult for many people to understand that grain has increased for ten years in a row and prices have risen for eight consecutive years, but now wheat prices have stopped rising. closer to market demand.