Demand for soybean meal in China, the world’s biggest consumer of the animal feed, may rise on expectations hog inventories will expand, the China National Grain & Oils Information Center said.
“The market is increasingly upbeat on the expectation of rising soybean meal consumption,” said the Centre. At the end of March, breeding sows made up 11% of the country’s total hog inventory, compared with the normal 9%, indicating higher capacity for reproduction.
Demand for soybean meal has a stable base because it’s not easy to alter the type of feed given to pigs, said Chen Baomin, analyst at Jilin Grain Group Co., said. If expectations build for a price rise, feed mills buy more to boost inventories.
China’s inbound soybean shipments may reach a record 5.5 mln t in May, up from about 4.3 mln t this month, the Center said. Imports in June may also be 5 mln t before declining to 4 mln by July, it said.
Source: Business Week