CHINA: Fourth batch of sugar sold at spot prices
Published: 03/08/2010, 10:08:21 AM
China auctioned most of the sugar it planned to sell from state reserves Friday, marking the first time the average price matched prevailing market prices, according to Dow Jones.
Nearly 258,000 metric tonnes out of the 260,000 tonnes planned was sold at an average price of CNY5,438/tonne (US$797), state sugar reserve regulator the China Merchandise Reserve Management Center said on its Web site.
The average price was higher than the previous auction held in January, when 356,500 tonnes were sold at CNY4,798/tonne, but was around the spot market price of CNY5,400/tonne in China's major producing regions quoted Friday.
"Theoretically, the more sugar released, the lower the price should be, as it brought more supplies to the market. But the real situation was the opposite, indicating demand is fairly good," said Yang Weidong, an analyst at Orient Securities Futures.
Friday's auction marked the first time the average price matched spot market prices "because the quality this time is better than previous batches," Yang added.