The State Grain Bureau issued a notice on Dec. 3 on additional procurement of 1.5 million MT domestic soybeans for state reserve, 1.03 million MT of which was to be done in Heilongjiang. The procurement price for this batch is RMB3,700/MT and the deadline is the end of Feb., same as those for the first batch. BOABC holds that the state procurement has little impact on the national soybean price.
As global soybean production grows faster than demand this year, world soybean inventory is predicted to add 2% in 2008/2009, reaching a level of 54.06 million MT. With the drop of international shipment cost, imported American soybeans are sold as low as RMB2,980/MT at Chinese ports, RMB500/MT cheaper than Heilongjiang soybeans.
China imported 37.82 million MT soybeans in 2007/2008, an increase of 32% on the year-on-year basis, accounting for 70% of domestic supply. Domestic soybean price is determined by imported soybeans.
High soybean price and falling soyoil and soymeal price in Heilongjiang have plunged local crushers in the red and crushers have to suspend purchasing local soybeans.
Due to the small amount of state procurement, domestic soybean rice keeps going south.
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