Demand for soybeans from China – the world’s largest importer of this crop – will decline at least until May against the background of low profitability of oilseed processing and a reduction in the use of soybean meal in animal feed. This is reported by the American news agency “S&P Global Platts” with reference to the forecasts of market participants.
“The oversupply of soybeans at the beginning of the year led to high stocks of raw materials, which greatly affected the profitability of processing” the materials say.
According to the General Administration of Customs of China, in the period from January 1 to February 28, China imported 16.17 million tons of beans, which is an absolute record for the period under review.
According to preliminary forecasts, in April another 8 million tons of soybeans may be imported into the country (-20% of previous estimates), in May about 9 million tons (-10%).
“The sudden rise in demand for soybeans following the lifting of COVID-19 restrictions in December has led to an overproduction of soybean meal. This comes at a time when demand from the pig sector is low, which deals a double blow to processors” one of the market participants commented to Platts.
Buyers from the Celestial Empire usually purchase about 95-97 million tons of soybeans annually and process most of the raw materials into feed, which are then mainly used in the pig industry.
However, according to analysts, the prospects for growth in the consumption of soybean meal in the pig sector of China look extremely weak, at least until mid-2023.