June 1, 2011
China failed to sell any of the 300,054 tonnes of reserve soy it offered at an auction Tuesday (May 31) after failures in the past several auctions, the National Grain and Oil Trade Centre said.
This is the 12th batch of state soy reserves put under the hammer since December of last year. Due to unappealing floor prices, China only sold out 11,100 tonnes of about 3.56 million tonnes of reserve soy at these auctions.
Currently, the soy market remains weak with slim transactions as processing mills are reluctant to make large purchases for losses in crushing domestic soy.
Analysts say that the failure is within market expectation mainly due to oversupply of soy. Port soy stocks are still at a high level of 6.3 million tonnes. The Ministry of Commerce estimated that soy imports delivered in May will reach 5.43 million tonnes, higher than its earlier forecast of 4.41 million tonnes.
Meanwhile, some media report said the government may lift caps on edible oil prices in early June. If such expectation is realised, the soy market may be boosted.