China Soybeans Fall Most In a Week on Cheap Import, Weak Demand

Soybean prices in China, the biggest consumer of the oilseed, dropped the most in a week amid concerns rising imports and slowing demand may impede measures by the government to boost prices.

May-delivery soybeans on the Dalian Commodity Exchange fell as much as 67 yuan, or 2.1 percent, to 3,206 yuan ($469) a metric ton, the biggest fall since Nov. 21. It last traded at 3,230 yuan, set for a 0.4 percent gain this week.

Purchases by the government of home-grown soybeans to build stockpiles have made them less competitive against foreign beans, forcing crushers in the main-growing region to shut operations or use imported beans, Cofco Futures Co. said in a research report.

"Government policies haven't been carried out properly at the local level," Chen Baomin, analyst of Jilin Grain Group Co., said in Dalian. "We are in a bear market and there's no news to turn that around."

Prices for imported soybeans set to arrive China in December will mainly be below 3,000 yuan a ton, compared with local prices of about 3,600 yuan, Cofco's report said.

China this month doubled its intended purchases of domestic soybeans, at fixed price of 3,700 yuan a ton, to 3 million tons after prices slumped following a plunge in global commodities.

In practice, the reserves have made little progress while farmers still struggle to sell their beans, Chen said.