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Mahamad Rodzi Abdul Ghani




Mahamad Rodzi Abdul Ghani


Dow Jones



Brazil Soyoil Exporters Fear Chinese Law Will Curb
20/09/04 LONDON (Dow Jones)--Brazil's soy crushers are concerned newChinese soyoil import rules on hexane levels will be used to curb boomingexports.Exports from the world's No. 2 soy exporter to China soared 182% to554,000 metric tons in the first seven months of 2004. But from nextmonth, Chinese soyoil imports can have no more than 100 parts per millionof hexane in unrefined soyoil, much higher than the industry standardthreshold of 600 parts."They could use these new restrictions to cool down exports," saidCesar de Sousa Borges, vice president of the Brazilian Vegetable oilIndustries Association, or Abiove.He said the new rules are part of a strategy to limit soymeal andsoyoil exports to nurture the expansion of the local crushing industry.Hexane is a derivative of petroleum used to extract soyoil. Producersalready make every effort to recover hexane and the threshold doesn't makeany sense, said Borges.

Abiove forecasts Brazil will export 900,000 tons of soyoil to Chinathis year, some 76% higher than the year before. Unrefined exports accountfor approximately 90% of these shipments.Since vessels take 45 days to reach China, the new rules could startaffecting shipments that left Brazil in the second half of August.The new rules come after Chinese authorities banned imports ofBrazilian soybeans from a long list of companies in April and May afterfungicide- tainted beans were found among cargoes.Overall, soyoil exports are expected to reach 2.7 million tons in2004- 05, up 12% from the year before.