June 16, 2006

 

China soy prices stable on thin trade

 

Soy prices in China were little changed in the week to Friday (Jun 16), amid thin trading on continued weak demand, traders and analysts said.

 

Crushers remained reluctant to buy much, as many have ample stocks of soymeal and soyoil, traders said, adding that imports, which have been stockpiling at ports, were more attractive if crushers were to buy.

 

Meanwhile, farmers were reluctant to sell amid falling cash values, as they held out in the hope if better prices, analysts said.

 

"Smaller planting area this year and drought have prevented farmers from selling their stocks, although they still have quite a lot," said Zhang Liwei, an analyst at the China National Grain & Oils Information Centre (NGOIC).

 

The NGOIC estimated that the soy growing area was down 10 percent from last year's 10 million hectares, because of falling prices in an oversupplied market, Zhang said.

 

In Heilongjiang, China's biggest soy-producing province, prices of average quality soys were little changed around RMB2,240-RMB2,300 a tonne.

 

In Jilin province, another major soy-producing area in China's north-east, prices were quoted around RMB2,460-RMB2,480/tonne, also unchanged from the previous week.

 

Arrivals of imports continued to rise in June. COFCO Futures Co said arrivals in June 1-10 reached 1.26 million tonnes, and about 1.8 million tonnes will arrive in the rest of the month.

 

A total of 3.03 million tonnes arrived in May, according to the company's statistics.

 

China National Cereals, Oils & Foodstuffs Corp, a major grains trading company, holds a controlling stake in COFCO Futures Co.