November 20, 2012

China to temporarily halt soy auctions

China will temporarily cease soy auctions from the country's reserves as it begins stockpiling fresh crops.

This will stop buyers of state-reserve soy from selling them back to the government now that Beijing has started buying new-crop soy at higher prices, the state-backed China National Grain & Oils Information Centre (CNGOIC) said in a report.

The government will pay farmers CNY4,600 (US$730) a tonne for soy, up 15% from 2011.

The government has sold 3.76 million tonnes from reserves in the year to date.

State soy sales effectively increased domestic supply and prevented price hikes when international prices soared between August and September.