China seeks to buy Argentine soyaoil

A Chinese trade delegation now in Argentina may be looking for a bulk purchase of soyaoil and is likely to discuss possible corn purchases, traders said on Thursday. The China National Grain and Oils Information Center (CNGOIC), citing market talk, said buyers may be seeking 300,000 to 400,000 tonnes of soyaoil from Argentina.
CNGOIC did not mention the trade delegation but said Chinese companies may have signed over 40,000 tonnes of import deals already. The Chinese trade delegation's visit to Argentina is part of a thaw in trade relations after Beijing imposed a de facto ban on imports of the cooking oil from the South American country for six months last year. The trade dispute was resolved in October and China imported 120,000 tonnes of Argentine soyaoil in the first quarter of 2011.
The addition of supplies from Argentina, the world's top soyaoil exporter, could boost China's soyaoil imports from June to September to 600,000 tonnes, up from about 50,000 tonnes expected for May, CNGOIC said in a report posted on its website (www.grain.gov.cn).
It estimated China's soyaoil imports in 2010/2011 would total 1.5 million tonnes. China's imports in 2010 fell 43.9 percent to 1.34 million tonnes due to the Argentina import ban, according to official customs data. "We have not heard about the detailed volume, but we believe at this stage they are only intended plans, just like soya purchases whenever there was a delegation outbound," said one trading manager with a state-owned trading house.
"But buyers are not likely to be very interested as current Argentina prices are about 350-450 yuan ($53.91-$69.32) per tonne higher than domestic prices." China is struggling to balance supply and demand of several major import commodities, since the government is reluctant to let local prices rise for fear of fuelling inflation.
But in recent weeks officials have trumpeted two victories in their efforts to keep supplies flowing, saying China had imported enough sugar to ensure 2011 supply and revealing a 1 million tonne purchase of US corn, which China had earlier denied having a hand in. Argentina has failed to keep its share of the Chinese market. While China's total imports more than doubled from the first quarter of 2010 to 300,000 tonnes in the first quarter of this year, the volume from Argentina was unchanged, allowing the United States to become the top supplier with 138,000 tonnes in the quarter.