HONG KONG (August 06 2003) : China has issued a handful of import permitsfor soyabean cargoes that have been waiting to unload, but it may be toolittle too late as fears of bureaucratic hurdles remain, traders said onTuesday.
Late last week, the Chinese quarantine authorities, known by the acronymCIQ, handed out about six import permits for the first time in weeks.
This allowed some of about 20 vessels to unload the oilseed after beingstranded at ports for days or even weeks.
But traders said Chinese crushers were still reluctant to enter new deals,as they feared the CIQ might not relax its grip for the rest of this year,partly because the domestic soyabean crop is due to be harvested afterSeptember.
"The problem is that market sentiment has not improved," said a trader atan international house. "Buyers will come back. It is a matter of time,but it won't be so soon.
I feel buyers are growing very conservative." "A vessel in Shanghai waitedfor almost 30 days to get the import permit.
If every receiver had to wait for 30 days, I can't say this is animprovement," said another trader in Shanghai.
Some traders said CIQ was expected to issue more import permits this ornext week, but others said some crushers had not been given licenses yetdespite promises by CIQ that they would get them before the end of lastweek.
In reflection of these worries over availability of the import permits,Dalliance soya futures have continued to rally so far this week, with theSeptember contract adding another 18 yuan to 2,687 yuan per tonne.
While soya trade has been bogged down by the uncertainties, China has beenpurchasing large quantities of soyaoil ahead of the Moon Festival inSeptember and the winter season when palm oil, the lower-priced vegetableoil, solidifies.
"Chinese keeps buying soyabean oil," said one trader at an internationalhouse based in Shanghai, adding Chinese 2003 soyaoil imports might comeclose to two million tonnes, more than double last year's 870,275 tonnes.
Most traders agreed China had already 1.8-1.9 million tonnes on the booksfor shipment in calendar 2003, compared with 2003 tariff-rate-quotas(THQs) totalling 2.818 million tonnes.
"There might be big price drops in December," said the first trader."They've bought a lot for October shipment, which will arrive inDecember."
The second trader added: "Everything is doubling. But we suffered from theSars outbreak. Chinese oil and meal consumption cannot be doubling."
Customs data showed Chinese soyaoil imports totalled 504,609 tonnes in thefirst half, up 589.0 percent from a year.-Reuters