China crushers wash out US soybeans amid tight margins: trade

Chinese soybean crushers washed out several cargoes of US soybeans last week as crush margins in China tightened amid...

Chinese soybean crushers washed out several cargoes of US soybeans last week as crush margins in China tightened amid CBOT soybean futures hitting a four-year high, market sources have told Agricensus.

At least two crushers in China were heard to have washed out front-month shipments of US cargoes as margins worsened due to the recent rally of soybean futures, according to three different trade sources who have knowledge of the matter.

“Because margins are too bad… [They] washed out and wait,” one well-placed source said, referring to a process whereby agreed physical trades are settled financially, rather than by taking ownership of the physical cargo.

Another two sources confirmed the action but declined to disclose further details.

Although the exact shipment could not be confirmed, market sources suspected that December and January shipments were the most likely.

Chinese crushers have almost fully covered their demand for December shipments and only have less than half a million mt left to cover for January, according to trade data gathered by Agricensus.

CBOT soybean futures last week surged to the highest level since June 2016 after the USDA cut estimates for 2020 ending stocks significantly.

At the same time, dry weather in Brazil has raised doubts over whether the country will be able to hit an expected record harvest of around 140 million mt this year.

What to read next
Spot lithium carbonate and hydroxide battery grade prices in the seaborne Asia market were stable in the week to Thursday April 4, with conditions quiet due to a public holiday in China, sources told Fastmarkets
A bullish consensus formed last week in Shanghai as leading market participants met for the annual CPICC conference and Shanghai Pulp Week. Meetings were held against the backdrop of growing concerns around market pulp and woodchip supply, while questions remained around the strength of underlying demand. Heading into the week, the rally in pulp prices […]
The March 2024 monthly averages were published today based on the index values of March 1, 8, 15 and 22.
Recent developments in China’s pulp and paper industry, notably the divestment of the Anhui Huatai pulp mill, prompted a closer examination of the dynamics of swing pulp lines, particularly the delicate balance between dissolving wood pulp and paper grade wood pulp. The Anhui Huatai pulp mill, which suspended production in the first half of 2023, […]
China’s manufacturing sector is overtaking its construction sector in driving the country’s demand for steel, in a shift that is expected to benefit flat steel products more than long steel ones, an industry expert said at an industry conference on Friday March 22
Producing battery-grade manganese sulfate in China is “logical” even for non-Chinese companies, due to the country’s strong demand and cost competitiveness, according to the chief executive officer of emerging Australia-headquartered producer Firebird Metals