Aug. 24 (Bloomberg) -- Japan will raise prices of imported wheat for sales to local flour millers by an average 1 percent in October, the first increase in two years, after Chicago futures surged on Russia’s export ban.
Prices will increase to 47,860 yen ($567) per metric ton on average, depending on the brand of the grain, from the current level of 47,160 yen, the Ministry of Agriculture, Forestry and Fisheries said today in a statement.
This is the first increase since October 2008, adding to costs for Nisshin Seifun Group Inc., Japan’s biggest miller, as well as rivals including Nippon Flour Mills Co. The gain is limited as the ministry changed the wheat selling price based on its purchasing costs in the past six months, Vice Agriculture Minister Takashi Shinohara said in Tokyo.
The change is small as “Japan does not import milling wheat from Russia,” Shinohara told reporters today.
Japan, which depends on imports for almost 90 percent of its wheat, buys the grain exclusively from the U.S., Canada and Australia through state tenders. The ministry, which controls imports and domestic sales to stabilize supply, is Asia’s largest wheat buyer as a single entity.
Wheat futures in Chicago jumped to $8.68 a bushel on Aug. 6, the highest level in almost two years, as Russia announced a ban on exports from Aug. 15 to Dec. 31, spurring importers to seek alternative supplies from the U.S., the top exporter.
December-delivery wheat traded at $7.1475 a bushel at 6:38 p.m. Tokyo time.
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