Miller Magazine Issue: 134 February 2021

79 MARKET ANALYSIS MILLER / february 2021 this year's soybean crop, well above the average forwards. At the same time, against the background of the delay in the harvesting campaign, the supp- ly of the first soybeans is limited, and information appeared on the market that some farmers may refuse to fulfill the contracts. In January, a record low amount of soybeans was shipped, and part of the lineup moved to February. Total shipment ob- ligations have already exceeded 6MMT (according to various information - up to 12MMT), and most likely will not be fulfilled. China has already resold several boats of Brazilian soybeans and processed products, insuring it with American cargo. In anti- cipation of a long vacation, China has virtually sus- pended soy purchases as many processing plants will be closed until March. The situation with the regular detection of excess glyphosate levels in Brazilian soybean shipments was again on the agenda between Russia and Bra- zil. According to ZernoOnline, over 2 years, Russian inspectors have identified about 600,000 Brazilian beans with a very high herbicide content. Argentina's soybean meal exports grew 38% in January 2021 over the previous year's record, according to the Refinitiv commodity survey. Soy- bean oil shipments also increased and reached 477kMT, which is the hi- ghest export in January since 2017. MEAT China's grain imports hit a record high. China imported a total of over 129.2MMT of grain betwe- en January and November 2020, according to customs data for December, 29.6% up from the same period last year. In general, Chi- na's dependence on imports of staple crops such as rice, wheat and barley is rather low, although there is signi- ficant demand for other gra- ins, oils and animal feed and meat products. The fact that corn and soybeans accoun- ted for nearly 80% of total grain imports indicates that most of China's grain im- ports are for livestock feed. The increase in grain imports to China over the past year is attributed to two key factors. First, the Chinese government is actively promoting pig production, which has led to increased de- mand for feeds such as corn and soybeans. At the same time, China's deep processing capacity for corn products has been increased from 76MMT in 2017 to 113MMT in 2019. Thus, the deficit in the supply of corn, previously a surplus crop, has been significantly reduced. Secondly, imported grains remain cheaper than Chinese grains. At the same time, the rate of pork imports to China has more than doubled compared to pre-ASF years, while domestic prices for meat, as well as for grain, re- main at record highs. An outbreak of bird flu was recorded in Vietnam, 100k heads of birds were killed, and in Hong Kong, an outbreak of ASF, 3,000 pigs were slaughtered. Despite the bearish report and the long Chinese holidays, there may still be a window of opportunity for soy- beans and corn in Mar- ch-April, and for whe- at towards the end of the season. But as you know, bulls are herbi- vores and they need to throw food - news, and predator bears will feed themselves. If you want growth - give the latest news, and the more unexpected - the better.