June 1, 2012

 

China's 2012 rapeseed imports close to record

 

 

The 2012 rapeseed imports of China is likely to reach its highest level so far due to damaged local crops brought about by adverse weather in major growing areas, traders and analysts said on Thursday (May 31).

 

The government has decided to stockpile the domestic rapeseed crop, now being harvested, at RMB5,000 (US$790) per tonne, 8.7% higher than last year's price, aiming to boost farmer incomes, traders said, lending support to domestic prices and encouraging imports of cheap new crop rapeseed, known as rapeseed, from largest exporter Canada.

 

The country's rapeseed imports jumped 308% in the first four months of 2012 on-year to 1.06 million tonnes.

 

"There is a price difference (between domestic and imported rapeseed) of more than RMB1,000 (US$160) per tonne that will likely boost imports to more than 3 million tonnes this year," said a trading manager at a state-owned trading company.

 

ICE Canada exchange quoted November rapeseed at US$565.8 per tonne on Wednesday.

 

The National Meteorological Centre said extended heavy rains from April to middle May, and hail and strong winds in parts of Hunan and Jiangxi had damaged crops.

 

"Rain has damaged crops in some areas, particularly parts of Hubei, Anhui and Hunan," said an analyst with an official think-tank. Hubei is the country's largest rapeseed-growing area.

 

"Some of the areas have been receiving rain since April, which has hurt yields as well as quality. We expect the oil content in domestic rapeseed to fall 2% as a result."

 

Farmers have also been planting more wheat in favour of rapeseed as Beijing offers higher subsidies for wheat. Acreage under rapeseed has fallen 2.1% this year.

 

The China National Grain and Oils Information Centre may revise its estimate for this year's rapeseed harvest to about 12.5 million tonnes, down from a projection earlier this month of 12.8 million tonnes, said an analyst at the centre.

 

The centre has forecast rapeseed imports this year at 2.5-3 million tonnes, up from 1.26 million tonnes in 2011.

 

China imported a record 3.28 million tonnes of rapeseed in 2009, mostly from Canada, but has since banned imports by crushers in major growing areas, citing disease concerns.

 

Traders said Beijing may partly lift the ban in the second half of the year to allow imports by some major crushers in growing areas.

 

"Imports will pick up from October, although old crop arrivals in the coming three months will be lower. We expect exports for the year to rise above three million tonnes," said an analyst at Shanghai JC Intelligence Co Ltd.