Soya buyers in China, the world's biggest importer of the oilseed, have stepped up orders from the United States this week after crushing margins improved ahead of the peak consumption season, traders said on Thursday. Chinese buyers are still keen to buy cargoes for delivery in the first quarter of next year, with another 3 million to 4 million tonnes of soya to be purchased in coming weeks to meet crushing demand, traders said.
Private exporters reported the sale of 290,000 tonnes of US soyabeans to China on Wednesday, pushing the Chicago Board of Trade January contract to a 2-1/2 week high. "Chinese buyers have been buying US soya over the past few days," said one senior soya trader. "Sales of soyaoil and soyameal on the domestic market have been increasing a lot. Margins have improved for crushers."
"Given that US supplies will be very tight and sold out by January next year, most of them have to buy in coming weeks," said the trader. Orders for 2012-13 delivery from the United States totalled 16.76 million tonnes by November 23, US Department of Agriculture data show, but traders said it will not be enough to cover demand by Chinese crushers from October to March. Chinese crushers process 4 million to 5 million tonnes a month.
"Purchases for early next year remain low. Some have not bought enough to keep operations going," said another trader with an international trading house. Industry sources said Chinese traders have already bought back some of the 600,000 tonnes of cargoes cancelled this month due to heavy crushing losses.
Crushing margins to process soyabean into soyameal and soyaoil are still negative, at minus 130 yuan ($20.88)per tonne, but have narrowed from 200 yuan the previous week, the China National Grain and Oils Information Center (CNGOIC) said. Physical soyameal and soyaoil have started to climb in the last few days. Traders said feed mills have increased soyameal purchases to replenish low stocks, while soyaoil traders have started restocking ahead of the peak consuming season ahead of China's Lunar New Year. Some crushers in the north have also turned to imports after defaulting on a total of 1 million tonnes ordered from the regular state soya auction.
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