China Grain Reserves Corp. (Sinograin) said it is investigating whether local crushers profited by selling oil processed from cheaper imported rapeseed instead of from domestic supplies as Beijing’s subsidy program stipulates. The probe underscores the potential for manipulation of China’s farm products stockpiling program, where a minimum purchase price set by Beijing to support farmers has caused local prices to be artificially higher than international prices…Full-text article: Alberta Farmer Express Aug 2013

Key points

  • The Chinese government pledged to purchase 5 million MTs from domestic rapeseed farmers at CNY 5,100 (US$830) per MT, with August 2013 import prices quoted at ~US$703 per MT
  • In July 2013, domestic rapeseed oil prices were quoted at US$1,273 per MT, while import prices were about 13% lower

ChinaAg Comment

  • Rapeseed production is situated in the central China, with Hubei producing 2.2 million MTs, Sichuan producing 2.1 million MTs and Hunan producing 1.8 million MTs in 2011

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