January 27, 2006

 

China soybean prices mostly stable in thin trade

 

Soybean prices in China's major soybean-producing regions were steady in thin trade in the week to Friday.

 

Most farmers and processors have stopped selling and buying in the last week before the Chinese New Year holiday, having already built up sufficient inventories.

 

In Harbin, the capital city of Heilongjiang province - China's largest soybean-producing region - prices of average quality soybeans were stable at about RMB2,500/tonne to RMB2,520/tonne.

 

In north-eastern Jilin province, prices were about RMB2,580/tonne, also unchanged from the previous week.

 

"Crushers have prepared enough products for the holiday's consumption," said Zhang Liwei, an analyst with China National Grain & Oils Information Centre.

 

Zhang said that even if they were to buy or sell now, transporting the product would be a problem.

 

China's public transport systems are strained as passenger traffic increases sharply during the Chinese New Year holiday, also known as the Spring Festival, which falls on Jan 29 this year.

 

Droves of travellers return to hometowns for family reunions during the festive season.

 

Analysts said trading may only resume in mid-February.

 

Meanwhile, the Ministry of Agriculture predicted that domestic soybean output in 2006 will be higher than last year's, but will fail to meet the even faster growth in consumption.

 

China can use part of its reserves to meet demand, according to a statement posted on the ministry's website Wednesday.

 

The statement did not give any specific data.