China soy prices down slightly on higher futures, imports

Soy prices in Harbin city in Heilongjiang, a key growing province, were around RMB3,560-RMB3,580 a tonne, down from RMB3,600/tonne a week earlier.

In Jiamusi, also in Heilongjiang province, the prices were RMB3,500/tonne, down from RMB3,540/tonne.

Analysts attributed the decline to a plunge Tuesday in CBOT soy contracts. A technical correction sparked by favourable weather conditions and bearish economic signals from outside markets sent the contracts to nearly limit-down, and that weighed heavily on prices of Dalian Commodity Exchange soy contracts.

Meanwhile, high imports in recent months have started to pressure crop prices in domestic market, analysts said.

China's Ministry of Commerce said Thursday (July 9) in a report on its Web site that it has estimated soy imports in June at 4.23 million tonnes, and revised its projection of July soy imports upward to 4.28 million tonnes from 3.56 million tonnes.

If the July projection is accurate, it would be the highest volume of monthly imports ever by the world's largest soy importer, with June imports the second highest.

Looking ahead, analysts said soy price movements would be largely correlated to demand from downstream users such as vegetable oil manufacturers and feedmeal producers, but government buying would be crucial to helping the crop find support.