November 9, 2009

With the US exporters accelerating their cargo loading, Chinese soy crushers expect supplies from the US to increase from late November, thus alleviating the current supply tightness, according to an official survey.

China has already purchased more than 15 million tonnes of US soy and further procurements would be for shipments after February, the China National Grain and Oils Information Centre said.

On the other hand, the soyoil market rose on healthy demand. Cold weather in most parts of China led to a reduction of the use of cheap palm oil in the production of edible oils, which lowered its market share. Therefore, some market participants are expecting soyoil demand to rise further and take over the market shares of palm oil and the expensive rapeseed oil.

Meanwhile, as more crushers in the coastal areas shut down their operations, the resultant tight supply situation firmed up the prices of soymeal. However, the centre said the increase in soy imports in November could boost soymeal supply and lower the prices.

With farmers delaying sales and Beijing's pledge to continue stockpiling the crop, the corn market stayed strong during the period in review. The increase in purchases by feed mills and processors in the north and south also lent support to prices.

Although sales of flour were flat, the wheat market remained strong. However, demand by feed millers was sluggish as the bidding volume at the weekly government auction was 150,000 tonnes lower during last week.