Small Chinese wheat mills feel the pressure
Rising wheat prices in China are putting pressure on thousands of the country’s small flour mills, speeding up rationalization of the world’s biggest milling industry and boosting the market share of bigger players. Many small-scale mills have been forced to shut down or cut back operations since late last year, analysts and industry insiders said, as government buying of high- quality wheat and bad weather in big producing regions tightened supplies. The price hikes have squeezed margins and left smaller mills competing for high-cost supplies, while larger cashed-up mills have benefited from buying in advance at cheaper prices. “It is really hard to do business now,” said Mr. Tong, who runs a small flour mill with about 10 to 20 metric tons of output a day in China’s eastern Shandong province, a major wheat and flour producer.
