China selling state soybean reserves to curb prices

Speculation may be part of domestic price increases

China has started offering 400,000 tons of soybeans from state reserves every two weeks as a measure to help offset high animal feed prices and control domestic inflation, according to reports.

Soybean imports have decreased since early June when prices began to rise. The domestic price of soymeal has risen 60 percent in 2012; soyoil and soybeans have gained 13 percent and 15 percent, respectively.

Some analysts are attributing a large part of the soymeal price surge to speculative buying on the futures market. “Despite tight supply, soymeal prices have gone far beyond supply-demand fundamentals,” said one analyst. China’s top economic planner, the National Development and Reform Commission, met with representatives of major crushers to warn them against excessive speculation.

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