| Chinese Government Suspended the Auction of State Reserve Rapeseed Oil |
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by Desmond Ng
Regional Manager, China
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According to the latest announcement made by the National Grain Trade Center on 14 Mar 2017 (a day before the weekly auction session for all the grains & oils products covered by the agency), rapeseed oil has been taken out from the list of items for this week’s auction. What this means is that the auction of state reserve rapeseed oil which started since 12 October 2016 has been suspended. The suspension was considered early as the harvesting of domestic rapeseed has yet to start in full swing and the reserve level is still considerably high at 1.38 million MT.
The suspension came early mainly due to the outcry from the local industry and traders that the release of state reserve rapeseed oil has led to the build-up of rapeseed oil stock in the market. This has put pressure on the rapeseed oil price, especially when the auction price has started to become lower lately and caused those successful bidders of earlier batches of state reserve rapeseed oil to experience difficulty to sell it to the local market as their bidding price was far higher in December 2016 and January this year. |
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