China’s Sinograin unleashes 500k mt state soybean reserve to Cofco

China’s state-owned stockpiler Sinograin was said to have granted a release of a half million mt of national soybean reserve to the state-owned crusher Cofco as supply concerns have mounted amid low stock levels and weak imports in March, several trade sources told Agricensus on Tuesday.

This is the second half of the one million mt total volume that Sinograin previously assigned to Cofco this year, three China-based soybean traders confirmed with Agricensus.

“It has been approved today,” one of the soybean traders who was familiar with the matter said.

A soybean supply shortage in China loomed larger last month, with commercial soybean stock reaching near the record low level of two million mt by the end of the month, and imports during the month are expected to fall about 15% year-on-year.

“It is probably that they are worried about shipment delays in Brazil so that they want to use reserves,” one soybean trading manager at an international trading house said.

The half-million reserves will be given to Cofco during April this year, sources said.

A number of small-to-medium crushers in China have faced supply shortages since mid-March this year as the ongoing coronavirus caused logistics disruptions, among which many were forced to shut facilities to avoid overheads costs.