March 28, 2012

China unable to sell 300,000 tonnes reserve soy

China has failed to sell out any of the 309,722 tonnes of reserve soy it placed at an auction on Tuesday (Mar 27), according to the China National Grain and Oils Information Center.

The auction attracted no bidders as many processing mills preferred new soy for higher oil yield. Meanwhile, the floor auction price of RMB3,920/tonne (US$621.27) was not appealing to traders.

Affected by persistent rise of soy prices and decreasing supply of new homegrown soy on the market, some small and mid-sized oil crushing plants have maintained low operating rates.

China has arranged 31 auctions of state soy reserves since December 2010. However, the government only sold out 16,100 tonnes of the total 9.37 million tonnes of soy from reserves at those auctions.