September 21, 2004

Northeast Chinese Soy Crushers Begin Procuring Early-Ripened Local Soybeans

An eFeedLink Exclusive Report

Soybean crushers in China's northeastern Liaoning province have reportedly started procuring early-ripened locally produced soybeans.

Boosted by favorable crush margins and tight soybean supply as a result of the previous defaults on soybean contracts with overseas suppliers, procurement prices of China's locally produced soybeans have risen to as high as RMB2,800/MT. The procurement prices in part of Liaoning province have reached RMB3,300/MT on Tuesday, September 21. The relatively high price level is beyond many market participants' expectations.  

Strong recovery in crush margins has induced Chinese soybean crushers to reenter the international markets to make fresh purchases of soybeans.

According to trade sources, China's soybean importers have reportedly booked over 4 million metric tons of soybeans for September-November shipments from international trading houses on September 20. If this is correct, the large import volume is substantially higher than the imports of 3.31 million metric tons during the September-November period of 2003.