November 15, 2007

China imports soy amid fear of inflation

China bought at least three to four cargoes of soy from the US and South America to increase its state reserve amid soaring cooking oil prices.

China sealed the deal on US cargoes at cost-and-freight premiums of 340-350 US cents on the Chicago March contract. Beijing is expected to extend its special lower duties on imports for another three months. It has recently cut the duty from 3 percent to 1 percent to address increase of food prices.

Industry players said that the government was likely to buy around 500,000 to 5 million tonnes of soybeans and might shift foreign reserves into resources.

The increased demand from China pushed the soy market of Chicago Board of Trade to fresh three-year highs. US exporters reported sales of 44,300 tonnes of  soyoil to unnamed buyers.