December 13, 2010

 

China's soy prices stable amid government efforts

Soy prices in China's major producing areas were mostly unchanged in the week to Friday (Dec 10), in line with the government's efforts to stabilise food markets.

 

Soy prices in Harbin, in the major producing province of Heilongjiang, were between RMB3,720-3,800 (US$558-$570) a tonne, flat from a week earlier.

 

Prices in Lian Yungang, Jiangsu province, were around RMB4,050-4,100 (US$608-$615)/tonne, also unchanged.

 

Current prices are reasonable and also in line with the government's recommended purchase price, which stands at RMB3,800 (US$570)/tonne, analysts said.

 

The government has told major edible oil producers to hold down prices as the Lunar New Year, a peak consumption season, is approaching. Major flour makers have also been told to cut or hold down prices.

 

The National People's Congress, the parliament, will start its annual session March next year, and before that the government will do its best to stabilise prices.

 

Purchases from feed mills and the pace of farmers' soy selling were stable over the week, experts said.

 

An auction of about 191,000 tonnes of soy from Heilongjiang's provincial reserves Friday failed to attract any bids, indicating that domestic supply is ample, and crushers decided to wait until the market outlook gets clearer.

 

China's soy reserves are around six million tonnes, according to sources.

 

November soy imports of 5.48 million tonnes were nearly double the level a year earlier, the Ministry of Commerce said.

 

The ministry also revised up its soy import forecast for this month to 5.8 million tonnes, from a prediction of 5.3 million tonnes issued earlier in the week.