23 Sept, 2003 (Oil World Flash) - The official import data for Augustconfirm very strong domestic demand. Imports were higher than expected forsoybeans and, in particular, again for palm oil. Soybean imports wereboosted to 2.45 Mn T and this brought the total for Oct/Aug 2002/ 03 to arecord 18.4 Mn T or more than double the quantity imported the yearbefore. A slowing-down is now expected for September. But Chinese soybeanpurchases have picked up and we should see increasing US exports to Chinafrom October onward. The latest US export sales report showed newcropsoybean export commitments to China at 1.8 Mn T as of Sept 11, up from1.69 Mn T a year ago. Last week’s Chinese purchases were not yet includedin this figure.
Palm oil imports increased sharply and reached a record 415 Thd T inAugust. This was more than we had expected and well up from 291 Thd T lastyear. 284 Thd T came from Malaysia and 126 Thd T from Indonesia. Chinesebuyers took advantage of the favourable palm oil prices and the attractivediscounts vis-a-vis soya oil.
Soya oil imports in August were about in line with our expectations at 245Thd T and about double the year-ago level. Out of the total 170 Thd T camefrom Argentina, 65 Thd T from Brazil and 10 Thd T from the USA.
Rape oil imports were again relatively high at 8 Thd T in August, againmainly originating in Canada. Imports of Canadian canola oil will pick upin the next three months following large-scale Chinese purchases, whichwere done in an effort to rebuild stocks to the desired level as ofend-December.
Total Chinese consumption of oils & fats is probably turning out higherthan we expected hitherto. In our latest assessment released last week weplaced total Chinese consumption of 17 oils & fats at 21.3 Mn T inOct/Sept 2002/03, reflecting an increase by 1.3 Mn T from a year ago,driven by a continuation of favourable economic growth and risingdisposable income. Although the Chinese demand development has alreadybeen phenomenal (it more than doubled within the past ten years), we mayfind actual consumption this year even outpacing our previous estimates.
We now expect some slowing-down in palm oil imports in the near term. Butimports of soya oil will be picking up sharply at the end of Sept and Octconsidering the huge vessel lineups in Argentina and trade estimates thatArgentina alone may boost soya oil exports to China to a record of 250-280Thd T during September.