August 3, 2009
China to hold third soy auctions on August 5
China will hold a third round of soy auctions on Wednesday, August 5, offering a total of 500,000 tonnes, after the first two rounds failed to attract bids, the official website www.grainmarket.com.cn said.
The site reported that two million tonnes of state corn reserves would be sold on Aug. 4, in northeast Liaoning, Jilin, Heilongjiang provinces and the neighbouring region of Inner Mongolia.
Soy sales in last two weeks have failed to attract buyers as the prices have been around RMB200 (US$29.26) per tonne above spot market prices.
Li Dongji, an analyst with Guotai and Junan Futures said he is expecting similar results from this week's auctions and traders will just monitor rather than bid for expensive soy.
Analysts expect the government to cut auction prices or subsidise local crushers to draw buyer interest.
Corn bidding saw a modest increase last week at 928,300 tonnes, taking total sales to 1.67 million tonnes in two weeks, which helped ease the tight supply in key agricultural regions.
US$ 1 = RMB6.83 (Aug 3)
