December 3, 2007

 

Asia Grain Outlook on Monday: Soybean may fall on slower China buying

 

 

Soybean prices may fall in the week ahead as China is slowing down import orders after weeks of frenzied buying.

 

Chinese companies bought eight to 10 cargoes of soybean in the week ended Nov. 30, compared with nine to 11 cargoes in the preceding week.

 

Wheat prices may react to bids being offered for India's tender to buy more than 300,000 metric tonnes of wheat. Bids are likely start later on Monday, though the tender may not be awarded until next week.

 

So far, Chicago Board of Trade wheat prices have been supported by expectations of continued Indian wheat imports as the country looks to shore up its domestic stocks.

 

The country's wheat imports should rise in the next financial year beginning April 1.

 

Avinash Raheja, senior analyst at Commtrendz Risk Management Services, a local commodity brokerage firm, said the country may end up importing 4 million tonnes of wheat in the 2008-09 financial year, as India's wheat buffer stocks are not growing at a fast clip, while wheat acreage faces challenges from oilseeds and other competing crops.

 

India is likely to import 2.3 million tonnes in 2007-08, according to the government.

 

However, despite wheat sowing so far this year lagging behind last year's levels, Finance Minister P. Chidambaram Friday said India's wheat output may rise by 1 million tonnes in 2008 to 75.89 million tonnes, from 74.89 million tonnes in 2007.

 

India's wheat crop sown from October to December, is harvested from January to March.

 

In other news, South Korea's feed buying groups Korea Feed Association and Major Feedmill Group bought 26 cargoes - 45,000-55,000 metric tonnes each - of mostly U.S. corn, in November.

 

The total purchases are likely to be between 1.1 million tonnes and 1.4 million tonnes.