(NAFB) – China’s soybean imports are likely to slow sharply during the second half of this year after a record first-half buying spree.
Reuters says that puts a dent in expectations for sustained growth from the top global soybean buyer and hurts U.S. market sentiment just as farmers will need to sell their new crop. A serious drop in hog profitability and a sharp rise in the use of wheat for feed are slowing down Chinese demand for soybeans, just as farmers are expecting to pull in their third-largest harvest in history. That will add further volatility to a critical crop, which rallied earlier in 2021 to nine-year highs.
The manager of a crush plant in northern China told Reuters that, “Soymeal demand is reaching rock bottom as the basis hit its lowest point so far this year. We can’t place a lot of orders to make purchases, so U.S. soybean exports will surely be hit.”
China imported a record 48.95 million tons in the first half of 2021, up nearly nine percent on the year as hog herds recovered from African Swine Fever and top producer Brazil shipped a record crop to the Asian nation.