May 5, 2008 

Heilongjiang's soyoil prices slump on oversupply

Spot oil prices in Heilongjiang, a major grain and oil province in China, have been falling since the start of March.

In fact, factory prices of first-grade soyoil produced by Heilongjiang Jiusan Oil & Fat Co., Ltd. fell as much as 31.7 percent on April 29, 2008 from its previous peak of RMB 18, 000 a tonne.

Li Shijun, an analyst at the Heilongjiang company said residents had stocked up large quantities of the oil previously during the Chinese Lunar New Year period in February, worrying that already high oil prices would climb even higher due to the snowstorms in southern China.

Moreover, the nation imported up to 720,000 tonness soybean oil in the first quarter of 2008, more than 23.8 percent over that a year earlier.

In early April, prices of soyoil futures and palm oil futures climbed 15 percent, respectively, and rapeseed oil futures price about 13 percent. However, oil futures prices have dropped about 10 percent each in the last two weeks.