China, the world’s biggest soybean buyer, probably will cancel or postpone delivery of more cargoes from the U.S. and South America because of ample stockpiles in the Asian nation and slowing demand, Oil World said.
China canceled about 400,000 metric tons of U.S. soybeans in the two weeks to March 6, and “more cancellations are likely,” the Hamburg-based researcher said in an e-mailed report. China also canceled 500,000 tons from South America, mainly from Brazil, and “several other cargoes” may be postponed because of ample supplies at Chinese ports, according to the report.
“The intention of China to slow shipments of soybeans in the near term is primarily due to the current large stocks,” Oil World said. “A significant slowing-down of the year-on-year growth in Chinese soybean imports in the April-June quarter could have a bearish impact on soybean prices, unless any new export problems arise in South America.”
Soybean prices have slumped about 4.5 percent since reaching a nine-month high on March 7 on the Chicago Board of Trade, in part on concern about slowing Chinese demand. As of March 6, U.S. exporters sold 27.8 million tons of soybeans to China since the marketing year began Sept. 1, including 1.87 million tons still waiting to be delivered, U.S. Department of Agriculture data show.
This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.