A significant rise in China’s inspections of imported soyabean cargoes is leading to costly delays, according to three soyabean traders quoted by Reuters.
China introduced new customs procedures in April for discharging soyabeans and clearing times would now take even longer due to increased sampling of cargoes to check for pests and residues, the sources said.
“It is a double whammy. Earlier, there were delays in getting import licences and, over the last few days, there are more stringent checks on cargoes,” a Singapore-based trader at an international trading firm was quoted as saying.
China – the world’s leading buyer of soyabeans with a 60% market share of purchases – mainly takes cargoes from Brazil and the USA.
The country’s stricter customs checks come at a time of ample global supplies of soyabeans, the 12 May report said.
However, slow clearing times at Chinese ports were pushing up spot soyabean meal prices, Reuters wrote.
Soyabean meal prices in China have increased by almost 14% since the beginning of April, the report said.
In the two days prior to the report, all vessels arriving at the Chinese port of Rizhao, which handled more than 10M tonnes of soyabeans last year, had been inspected, two China-based traders with knowledge of the situation said.
Previously, only one in five vessels would typically be sampled, one of the traders said, adding that it took up to 10 working days before cargoes could be discharged following inspection.
Other ports in the country had also stepped up soyabean cargo inspections, according to one of the Beijing traders and the Singapore trader.
At the time of the report, about 30 vessels carrying about 1.8M tonnes of soyabeans were waiting at anchorage off ports in China, the Singapore trader said, leading to mounting demurrage costs.
Demurrage costs – fees paid to ship owners for failing to offload cargo at an agreed time – can be up to US$20,000/day for a Panamax vessel carrying 60,000 tonnes of soyabeans, according to the report.
All three traders declined to be named, Reuters said.
At the time of the report, China’s customs authorities had not responded to a fax from Reuters asking for comment.
Meanwhile, Canada’s canola industry was concerned that China would retaliate the country’s expulsion of a Chinese diplomat by blocking agricultural shipments, Bloomberg reported from a report first published by The Canadian Press.
In 2019, China had blocked canola shipments from two major Canadian companies following Huawei executive Meng Wanzhou’s arrest by Canadian authorities, the 9 May report said. The ban lasted for three years before being lifted last year.
The Canadian government expelled Chinese diplomat Zhao Wei on 8 May, alleging he was involved in a plot to intimidate Conservative MP Michael Chong and his relatives in Hong Kong, Bloomberg wrote.
According to Jim Everson, president of the Canola Council of Canada, maintaining predictable market access was key for Canadian farmers and although supportive steps had been taken by the federal government, nothing could replace access to an important market such as China.
China’s previous block on canola shipments took a toll on the industry with the value of Canadian canola exports dropping from US$2.8bn in 2018 to US$1.8bn in 2021, the last full year under the ban, the report said.
