November 7, 2005

 

China's soybean prices mostly flat on limited buying and bird flu

 

 

Soybean prices in China's major soybean-producing areas were mostly flat after a slight fall a week ago.

 

Trading remained limited as most large crushers continued to hug the sidelines.

 

In Harbin, the capital city of China's largest soybean-producing Heilongjiang province, new soybeans were quoted at RMB2,460-2,480/tonne on Friday, unchanged from a week ago.

 

Prices for new soybeans in Jiamusi, a city in eastern Heilongjiang, were flat around RMB2,420-2,460/tonne.

 

Farmers refrained from selling too much of their crop because prices have been much lower this year, said a trader with a crusher in Jiamusi city. "Prices were around RMB2,600/tonne a year ago."

 

"We don't run at full capacity because of sluggish demand and poor soymeal prices," he added.

 

The crusher currently sells soymeal at RMB2,240/tonne, the lowest known offer price in the domestic market.

 

Soybean prices were quoted around RMB2,440/tonne in Mudanjiang city, little changed from a week ago.

 

Many crushers are still cautious about soymeal demand, as concerns over bird flu continue to haunt the local market, traders said. Soymeal is mainly used as poultry feed.

 

China reported Thursday its fourth outbreak of bird flu among fowl since October. It had confirmed three other outbreaks in Inner Mongolia, Anhui and Hunan.

 

The latest outbreak killed 8,940 chickens in a village in north-eastern Liaoning province and prompted authorities to destroy 369,900 other birds.

 

"Soybean prices may fall slightly ahead as large crushers have not begun buying, although some farmers may have to sell some," said Liu Zhaofu, general manager with Soybeanchina.com, an industry information provider. "But the overall trend will be determined by prices in CBOT soybeans."

 

Meanwhile, reselling prices for imported soybeans were quoted around RMB2,700/tonne in Qingdao on Friday, slightly higher than RMB2,680/tonne a week ago, a local trader said.