Sharp decline in October soybean imports

BEIJING - China's imports of soybeans registered an unexpectedly sharp decline in October.

However, a monthly decline is unlikely to affect the domestic market, agricultural experts said on Wednesday.

Imports of soybeans dropped 19.6 percent from September to 3.73 million tons in October, the second lowest this year after February's total of 2.95 million tons.

Overall imports of soybeans for the first 10 months of the year jumped 25.8 percent to 43.9 million tons year-on-year, according to data released by the General Administration of Customs on Wednesday.

"Surging prices in the international food market may have played a major role in the drop in China's imports," said Hu Bingchuan, an assistant researcher at the Rural Development Institute of the Chinese Academy of Social Sciences.

During the first 10 months of this year, soybean futures at the Chicago Board of Trade peaked at $427.18 per ton in October, jumping from $358.97 in January, an increase of 20 percent.

The October price was also the highest since August 2008.

Propelled by surges in the international market, increases have also been seen in the domestic price of soybeans, vegetable oil and other agricultural commodities.

Soaring prices in the food market reduced revenues for domestic soybean-processing companies, and may have prompted them to adjust their import policies.

Conversely, monthly fluctuations may also be the result of a cluster of market factors, which is quite natural and "will have little influence on prices in the domestic market", said Hu.

Ma Mingchao, a futures analyst with Shanghai-based Qingma Investment Co, echoed Hu's opinion, saying a monthly change need not necessarily lead to the reduction of China's soybean imports for the whole year.

Meanwhile, "large amounts of soybean imports are expected within the remaining two months of this year, which will help ease the price hikes in the domestic food market," he said.

China is the largest global consumer of soybeans, but annual domestic production amounts only to one-third of its import volume. This year imports are expected to exceed 50 million tons.