Huge Soybean Orders Causing Bottleneck at Chinese Ports
Huge soybean orders placed by Chinese buyers in recent months, combined with more stringent customs inspection protocols, are resulting in a severe backup at China’s ports as stockpiles in the country reach multi-year highs.
Traders have told Reuters that vessels holding as much as 700,000 tons of soybeans are waiting along China’s coast for the ability to discharge their cargo, and that the long wait times may trickle down to affect the recent rally in soymeal prices and demand from the U.S. and Brazil. Indeed, a lack of warehouse space has caused the worst delays at the port in Rizhao, where up to as many as seven cargo ships holding 400,000 tons of soybeans are waiting to discharge.
Chinese imports of soybeans reached a record 9.59 million tons in May, with arrivals topping 9 million tons in June, however shipments can be held for up to a week waiting for certification from quarantine regulators.
Total soybean stocks at China’s ports are at 7 million tons, according to the China National Grain and Oils Information Center, while stocks at the port in Rizhao are at a four-year high of 486,460 tons.
The congestion is not expected to let up anytime soon, as between 8.5 million and 9 million tons of soybeans are expected to be delivered this month.
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