October 1, 2007

 

China soy prices up on rising imported prices

 

 

Soy prices in China's major producing regions were higher in the week to Friday (September 28) higher prices for imported soy and new domestic soy.

 

In Harbin, the provincial capital of Heilongjiang province, China's largest soy producing region, the prices of domestic soy were at RMB3,540 to RMB3,660 a tonne, up from RMB3,440 to RMB3,540/tonne a week earlier.

 

Chicago Board of Trade soy surged this week on the news that China will cut soy import tariff to 1 percent from 3 percent during October to December to keep volatile prices in check.

 

Meanwhile, rising freight fees caused imported soy prices to exceed RMB4,200/tonne, RMB50 to RMB80/tonne higher than the previous week, said China National Grain and Oils Information Centre in its weekly report.

 

It expected soy prices to rise further due to increasing demand.

 

Farmers started to sell some early soy, and concerns of a lower output due to a drought drove prices higher, said analysts.

 

Soyoil prices were lower amid pressure from more supply, as China sold 200,000 tonnes of vegetable oil from state reserves.

 

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

 

In southern Guangdong province, fourth-grade soyoil was at RMB8,400 to RMB8,450/tonne, lower than RMB8,450 to RMB8,500/tonne a week ago.

 

In the eastern city of Dalian, fourth-grade soyoil was down at RMB8,400 to RMB8,450/tonne from RMB8,500/tonne a week earlier.

 

China's government sold 200,000 tonnes of vegetable oil Friday at the high end of market prices, indicating strong demand in the months ahead.

 

Despite the strong demand, vegetable oil prices are unlikely to be volatile in the short term amid the government's policies to curb food prices, said Kang Bing, a research manager at Jingyi Futures Co.

 

Soymeal prices were mostly stable, with prices in some regions higher on high soy prices.

 

In Jiangsu province, prices of average-protein soymeal were at RMB3,360 to RMB3,400/tonne, higher than RMB3,230 to RMB3,360/tonne a week earlier.

 

In Guangdong province, prices of average-protein soymeal were at RMB3,380 to RMB3,400/tonne, compared with RMB3,300 to RMB3,400/tonne.