China to auction soybeans from state reserves over supply squeeze

China will sell part of its state-owned reserves to increase supply in the world’s largest oilseed market, the National Food and Strategic Reserves Administration said on Tuesday, February 22.

The administration did not provide information on the auction volumes or dates.

The measure comes after shipments in recent weeks have fallen far short of expected volumes due to issues in Brazil, where the crop broke due to drought, influencing the pace of shipments.

Soybean meal prices have soared as pig farmers struggle with low prices for their animals in China.

“Soybean arrivals in February may be fewer than previously projected, and arrivals in March will also fall short from expected. The current predicament may endure till April,” Zhu Rongping, an agricultural analyst at commodity consultancy Mysteel, said ahead of the announcement.

He also stated that some edible oils will be sold as part of an inventory rotation process.

Source: Money Times

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