August 27, 2007

 

China soybean prices up on tight supply, rising freight fees
 

 

Soybean prices in China's major producing regions continued to rise in the week to Friday (Aug 24), on tight soybean stocks and rising freight fees.

 

The freight fees of South American soybeans hit US$100/tonne recently, lifting imported soybean prices to about RMB3,800/tonne.

 

In Baoqing, Heilongjiang province, China's largest soybean-growing region, prices of average-quality soybeans were about RMB3,200-3,340/tonne, up RMB100-120/tonne from a week earlier.

 

Prices in Jiamusi City in the north-eastern part of the province were about RMB3,400/tonne, compared with RMB3,240-3,360/tonne a week ago.

 

Traders are more reluctant to sell due to reduced soybean imports, a result of high prices at the Chicago Board of Trade and sluggish feed meal demand in July, said analysts.

 

Rising soymeal prices and weather concerns will likely push domestic soybean prices higher, said grain information provider Alibaba.com.

 

Soyoil prices were lower on falling soyoil futures in the domestic market and on the CBOT.

 

In Shandong province, fourth-grade soyoil prices were about RMB8,600/tonne, compared with RMB8,700/tonne in the previous week.

 

In southern Guangdong province, fourth-grade soyoil was at RMB8,400-8,500/tonne compared with RMB8,450-8,500/tonne last week.

 

In the eastern city of Dalian, fourth-grade soyoil was down to RMB8,800-9,000/tonne, compared with RMB9,000-9,100/tonne a week earlier.

 

The surge in vegetable oil imports and the end of stocks buying for the weeklong mid-autumn holidays from late September caused soyoil prices to fall, said analysts.

 

In July, China imported 202,334 tonnes of soyoil, more than twice last year, and 32,581 tonnes of rape oil, 20 times that of a year earlier, according to data issued by the General Administration of Customs Wednesday.

 

That contributed to a 24 percent rise in total edible vegetable oil imports to 4.27 million tonnes during the first seven months of this year, the data showed.

 

The increased supply kept soyoil purchasers on the sidelines, said China National Grain and Oils Information Centre.

 

Soymeal prices were slightly higher on recovered demand from the feed meal sector.

 

In Jiangsu province, prices of average-protein soymeal were at RMB2,750-2,850/tonne compared with RMB2,730-2,800/tonne a week earlier.

 

In Guangdong province, prices of average-protein soymeal were at RMB2,680-2,800/tonne, up from RMB2,650-2,720/tonne.

 

Farmers' confidence has recovered during the week due to a series of government policies that included subsidies and insurance. The number of live pigs in farms and backyards also rose 7.3 percent on-year, and increased 2.1 percent on-month, the Ministry of Agriculture said Thursday.

 

Sales of pig feed meal in July increased 6 percent on-year, and rose 5.2 percent from June, it said.

 

CNGOIC expects soymeal prices to remain at current high levels in the short term, on stable increase of feed meal demand.

 

RMB1=US$0.1322 (Aug 27)