February 18, 2008

China's January soy imports second highest ever

China's soy imports rose 41.5 percent in January 2008 compared to the same month a year before, according to official Customs figures released Friday (February 18, 2008).

Import volumes reached 3.44 million tonnes.

The figure was also a 17.6-percent over December imports, and ranks as the second highest monthly imports ever

The increase was seen to have been brought about as record soyoil prices in China prompted crushers to increase overseas purchases.

China's strong soy demand is supporting international soy and vegetable oil prices, which hit record highs over the past two months.

However, imports are expected to slow to 2.5 million tonnes in February as record CBOT prices currently may give crushers pause.

Another factor staying their hand is the fact that soymeal demand remains low as massive snowstorms killed millions of livestock over the Spring Festival.

However, if February imports are lower, it meant soyoil supply from March would be tight.

Last week, news that 40 percent of China's rapeseed crop was damaged in the snow storm resulted in CBOT soyoil futures hitting record highs as speculators anticipate more soy demand from China.

Chinese officials, in damage control mode, later told a news conference that only 6 percent of the country's rapeseed acreages would have no harvest and that larger acreages this year would offset part of the damage caused by the weather.