SOYBEX CFR China price fell to its lowest level this year at $362.57/mt Wednesday down $4.04/mt day on day, tracking falling CBOT Soybeans futures amid oversupply.
This is the lowest price ever recorded since S&P Global Platts started assessing SOYBEX CFR China prices on September 3, 2018.
The Chinese soybean importers are slowing feeling the effect of the African Swine Fever on livestock and as a result the soybean-based feed meal, sources said .
"Even though, crush margin remain positive, we could not sell our soybean meal stocks as [much] as last year and with soybeans still coming to China in early 2019, we are bearish for the soybeans import demand for June and July shipment due to weaker soybean meals sales," a Chinese crusher said.
According to China Customs data, domestic demand for soybeans remained low compared to previous years and the March import of soybeans was at 4.91 million mt ,13% lower than the same period in 2018.
The US-China trade talks have not provided much confidence to the soybeans global outlook. "The yet to be mutually agreed trade negotiation is taking too much time. Funds and traders' patience are running low with the rounds of empty promises coming from both sides," a trader said.
In addition, China-related government trading companies have delayed their procurement for US soybeans. "We have seen that China has in the past few months, bought millions of tons of US soybeans, however, they have paced down their purchase recently as we have not seen much volume of soybean movement out of US," a trader said.
According to the US Department of Agriculture, the US exported USD 13,386 million dollars worth of soybeans in October 2017 to February 2018 while a year later, exports were down 37% to USD 8,411 million dollars worth of soybeans.
The slowdown in consumption of soybeans mainly in China, has created much uncertainty as market participants are finding it difficult to digest the over-supply of soybeans from US, Brazil and Argentina.
Source:Platts
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