September 14, 2009
China soy price up; processors raise bids on thin supply
Soy prices in China's major producing regions were higher in the week to Friday (September 11) as processors raised the prices they offer to farmers to compete for limited supply.
Soy prices in Harbin in China's top producer Heilongjiang province were around RMB3,620 (US$529.96) a tonne, up from RMB3,600 (US$527.04)tonne a week earlier.
Soy prices in Jiamusi in the same province were at RMB3,600-RMB3,620/tonne compared with RMB3,560/tonne a week ago.
The soy harvest will start later this month, and crop availability is limited in the market.
Meanwhile, concerns over a possible decline in output due to a drought helped support prices.
Such concerns pushed the volume of soy offered by the government at its auctions to 29,300 tonnes Wednesday, the highest weekly volume since late July, when the auctions kicked off.
The China National Grain and Oils Information Centre cut its output forecast for soy to be harvest this year by 500,000 tonnes to 14.5 million tonnes in its latest report issued Wednesday due to a lower acreage estimate and bad weather, including drought. That indicated a 6.7 percent decline from a year earlier.
Soyoil prices were lower on ample supply amid weak demand.
First grade soyoil prices in Rizhao in Shandong province were around RMB7,200/tonne, down from RMB7,300/tonne the week before.
First grade soyoil prices in Dongguan in Guangdong province were between RMB7,100-RMB7,200/tonne, down from RMB7,300-RMB7,450/tonne.
China imported 790,000 tonnes of edible oil in August, up 36 percent on year, the General Administration of Customs data showed Friday.
In the year to date, total imports rose 3.3 percent to 5.16 million tonnes.
"The market needs to digest earlier (imports)," said Xiao Jun, an analyst with commodities consultancy Shanghai JCI.
Big vegetable oil traders have cut retail edible oil prices nationwide ahead of the long National Day holiday and Mid-Autumn Festival to compete for market share.
An expected good US soy harvest also pressured the outlook for soyoil prices.
Soymeal prices were lower.
Prices in Rizhao were around RMB3,380/tonne, down from RMB3,400-RMB3,450/tonne.
Prices in Dongguan were between RMB3,380-RMB3,400/tonne compared with RMB3,400-RMB3,500/tonne.
US$1= RMB6.83 (Sept 14)
