Soy imports from China in April fell 12% year-on-year, customs data showed on Thursday, with analysts citing the impact of the unfavorable climate that delayed cargo from Brazil, the main supplier.
China, the main buyer of soybeans in the world, imported 6.714 million tonnes of the oilseed in April, down from 7.64 million tonnes in the same month last year, according to figures from the General Customs Administration.
Rainfall at the end of February delayed the harvest and exports in Brazil, leading to record low supply of soy and soy meal in China, which uses the commodity to feed its massive livestock sector, as well as to manufacture cooking oil.
Some processors had to stop operations, while the state-owned storage company Sinograin released soy from its reserves to the also state-owned COFCO.
“The arrival (of imported soybeans) in April was slightly below the market estimate,” said analyst Monica Tu, of Shanghai JC Intelligence consultancy.
“The drop was still due to slow shipments in Brazil earlier, which only started to accelerate in the second half of March”.
There is also an expectation that China will increase soy purchases from the United States to fulfill commitments of a phase 1 trade agreement signed with the Americans in January.
But the volume of cargo from the U.S. may not grow significantly in the short term, as buyers have covered most of their needs for the next few months with soy from Brazil, analysts said.
In the first four months of 2020, China imported 24.51 million tons of soybeans, according to customs.
A large volume is expected in May and June, given that the number of shipments leaving Brazil in March is at record levels. The sea voyage takes about 40 days.
“We should expect that May will be big (in numbers of soy imports),” said analyst Darin Friedrichs of INTL FC Stone.
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