Could The US Run Out Of Soybeans?

China continues to import soybeans at an astonishing rate with latest estimates showing that they imported almost 14 MMT in the first four month of 2009, 36% higher than a year ago, according to official customs data.

April imports alone were 55.2% higher than a year ago at 3.71 MMT, as the government continued to buy beans aggressively on the domestic market hoping to stimulate the economy and maintain growth. This keeps forcing Chinese crushers to look to import.

How long can they keep this up for remains the big question.

A little while longer yet seems to be the answer, as May imports could reach an all-time record 4.2-4.6 MMT according to one local analyst.

Buying at this kind of pace, particularly if much of the business keeps going America's way, looks like continuing to support the nearby market even if US plantings end up increasing by another 2-3 million acres.

They're not physical beans. If spot beans is what you want then you'll have to pay up. With US ending stocks already tight, we will know by how much later today, we could be in for a very interesting summer.

Could the US run out of soybeans? It's not that unthinkable, they very nearly did last year. As I put on the blog yesterday limitless and expiring September 2008 soybeans posted an astonishing gain of 274c on the last day of trading as delivery wasn't an option for short sellers getting squeezed by a lack of physical beans.

And China wasn't taking beans at anything like the current rate then, plus Argentina hadn't just had a crop disaster. Incidentally I read somewhere last night that Argy farmers have already got 50% of their crop sold according to the Rosario Grain Exchange. That would make sense as they probably desperately need the cash and are wary of any further government tinkerings after the June mid-term elections.

Interesting times, as ever.