China has raised the mininum purchasing price for wheat in 2022, the state planner said on Thursday, part of an effort to enhance grain security in the country.
The National Development and Reform Commission has set the 2022 minimum purchase price for wheat at 2,300 yuan ($357) per tonne, up from 2,260 yuan per tonne in 2021, a notice published on the state planner’s website said.
China buys wheat from farmers at the minimum price when the market price drops below that level in order to support food production.
The move came amid a renewed policy focus on food security from the government, and also comes after China raised the 2021 minimum purchasing price for wheat, the first it had increased this price since 2014.
Local authorities must guide farmers to plant reasonably, strengthen management in the fields, and promote stable production and improve the quality of the grain, the statement said.
Meng Jinhui, senior analyst with Shengda Futures said this showed that “the state attaches utmost attention to grain security.”
“It does not have a big impact on the markets in short term. But the key is that it can serve as the guiding direction, and bolster farmers’ confidence in growing the grain,” Meng added.
Beijing has said it will take greater efforts to boost grain yields, step up support for its domestic seed industry and implement strict land protection measures, all part of a push on food security after the COVID-19 pandemic.
Source: Reuters (Reporting by Hallie Gu and Shivani Singh; Editing by Toby Chopra and Jane Merriman)