October 19, 2009

China's soy prices in major producing areas were higher in the week to Friday (October 16), as farmers were reluctant to sell after the government promised to continue purchasing the crop this year.

 

Soy prices in Bei'an, in No. 1 producer Heilongjiang province, were around RMB3,540 (US$518.47) a tonne compared with RMB3,500 (US$512.63)/tonne a week ago.

 

Soy prices in Jiamusi, also in Heilongjiang, were at RMB3,520/tonne, up from RMB3,500/tonne.

 

News that the government will continue to purchase major grains from farmers, including soy, if prices fall sharply after the ongoing harvest, supported prices.

 

Market participants widely expected the government to buy new soy at prices higher than last year's purchase price of RMB3,700/tonne, as cash prices in major producing areas in the northeast are now around that level.

 

Soyoil prices were higher as local stocks were running low.

 

First-grade soyoil prices in Rizhao in Shandong province were between RMB7,050 and RMB7,250/tonne, compared with RMB6,950/tonne a week earlier, and at RMB7,150/tonne in Dongguan in Guangdong province, up from RMB6,900/tonne.

 

Soyoil demand is likely to pick up as temperatures fall, analysts said.

 

Soymeal prices were higher as imported soy arrivals declined in recent months, said China National Grain and Oils Information in a note, expecting the prices to remain at high levels in the near term amid strong demand.

 

Soymeal prices in Rizhao were RMB3,520-RMB3,580/tonne, rising from RMB3,430/tonne, and at RMB3,500/tonne in Dongguan, compared with RMB3,460/tonne.

                

US$1 = RMB6.83 (Oct 19)