July 12, 2010
China eases US soy crop buys
Chinese soy buyers have slowed down their purchases of new US crop amid high stocks at home and after Chicago Board of Trade price rises last week, said the China National Grain and Oils Information Centre (CNGOIC).
Market participants expected the US new soy harvest could hit a fresh record, which would not support Chicago prices' rise in future, said the centre.
Physical soyoil prices fell to the lowest in 8 months. Demand for the cooking oil was likely to remain low due to ample supply and increases of imports in the coming three months.
Soymeal prices picked up late last week supported by rising soy prices, but a surplus of soymeal supply will remain and cap any big price increases.
Pork prices have picked up, which would improve breeding profit, but breeders are not keen to restock more and chicken consumption is at a seasonal low, which would restrain soymeal demand in coming weeks.
US corn prices for August shipment were quoted at US$227/tonne or US$276/tonne after tax, RMB160 (US$23.63)/tonne cheaper than domestic prices, at the south port of Shekou.
Pork price rises could boost corn demand from feed mills, but profits from corn processors have been falling, which would limit demand from processors.
Corn starch processors were making losses of about RMB100/tonne (US$14.77) last week on rising domestic corn prices and falling starch prices.
