May 18, 2011

China's soy auction receives no bid over import competition

China's government failed to attract any bids for an auction of 300,054 tonnes of soy Tuesday (May 17), the ninth failed state soy sale out of 11 this year, the China National Grains & Oils Information Centre (CNGOIC) said.

The failed sale was widely expected among market participants, including the CNGOIC, which forecast Monday that "the latest auction is likely to attract no bids, as import prices have been falling and state prices aren't offering much of an advantage."

The government is continuing regular sales of soy stockpiles in a bid to keep downstream prices stable.

Import prices are RMB3,950-4,000 (US$607-615)/tonne, RMB200-280 (US$31-43)/tonne higher than local prices, CNGOIC said. They were around RMB4,200 (US$646)/tonne a month ago.

The CNGOIC did not state its offer prices in the notice Tuesday. Soy at a government stockpile auction last week was priced slightly above the cheapest market rates.