DJ China Soybean Prices Rise On Increased Holiday Demand 29.08.2011
BEIJING (Dow Jones)--Soybean prices in China rose slightly in the week to Friday, as traders start to regain some of the confidence they had lost as a result of the government's price controls amid anticipation of a demand increase during the upcoming Mid-Autumn Festival and National Day holiday.
Prices in Heilongjiang, the top producing province, were up about 1% to around CNY3,900 a metric ton, while import prices at major ports rose 2% to around CNY4,250/ton.
Ex-factory prices of soyoil were around CNY10,000/ton Friday, up 1.5% from a week earlier, while retail prices at major supermarkets rose around 5% in August, traders said.
After Yihai Kerry Group, the Chinese subsidiary of Singapore-based Wilmar International Ltd. (WLMIY), announced a 5% price hike in early August, most domestic crushers followed suit.
"Prices will continue to rise between the Mid-Autumn Festival in mid-September and National Day in early October," an edible oil trader said.
Analysts expect the government to restart auctions of rapeseed oil from state reserves around October, as it did last year, to increase market supply.
Meanwhile, the government is expected to loosen control of edible oil prices through the rest of the year, as China's consumer price inflation is believed to have peaked in July. Prices of pork, a large contributor to inflation, are starting to show signs of stabilizing.
The National Development and Reform Commission said Tuesday that it would "opportunely" increase market supply of grains and edible oil by releasing state reserves