June 9, 2008

China's soy oil market weak on excess stock

China's soy oil traders expect weak trading in the days ahead due to high stocks and strong imports, an official think-tank said.

The China National Grain and Oils Information Center (CNGOIC) said Friday that soy oil imports would be larger in May and June, pressuring a market that already faces excess supplies.

Soy oil prices fell to the lowest level of the year in China's coastal areas, where most crushers are located, CNGOIC said.

Chinese crushers face poor margins so they have not been active buyers, observers said.

Prices for imported soy were offered at between RMB4,950-5,000 (US$712.6-US$719.8) per tonne.

Meanwhile, soymeal prices are expected to stay strong due to tight supplies, particularly in the south province of Guangdong.