China cancels soybean cargoes
Some Chinese soybean importers have cancelled soybean import cargoes scheduled for delivery in the next few months, because they fear the recent fall in prices that has wiped out their crushing margins may extend further, two separate traders said Wednesday.
With margins turning negative, Chinese crushers stand to lose about CNY100 for every ton of soybean they process at current prices.
CBOT soybean futures fell to $13.7/bushel Wednesday, down 10% from May 1. The import prices of soybean in the domestic market has fallen to about CNY4,300/ton now, from about CNY4,600/ton at the start of the month.
This has pushed down the price of soyoil and soymeal in the domestic market, making crushing previously bought soybean a loss-making proposition for most processors.
A mid-sized soybean crusher in the coastal province of Shandong is likely involved in cancellations of some of the cargoes it had booked, a Shanghai-based trader said, without elaborating on the size of the cancellations.
Another trader in Guangdong also confirmed the crusher has cancelled some soybean cargoes, after making losses on earlier shipments that were processed. The company couldn't be reached for comment immediately.
Some companies are also reselling cargoes at sourcing ports, before the soybean is shipped to China, traders said.
According to an analyst with Shanghai JC Intelligence, some Chinese corn importers have also cancelled or delayed shipments recently, although the quantity involved isn't large.
-Zhoudong Shangguan contributed to this article; Dow Jones Newswires; (8610) 8400 7715; firstname.lastname@example.org
(END) Dow Jones Newswires
May 23, 2012 02:51 ET (06:51 GMT)
DJ China Buyers Cancel Soybean Cargoes As Prices Fall, Squeezing Margins -Traders->copyright