BEIJING\/SHANGHAI, Feb 26 (Reuters) – China\u2019s soymeal futures slid nearly 5% in their sharpest decline in eight years on Friday, as investors took profit and new African swine fever outbreaks stirred concerns over demand.<\/p>\n
The most actively traded soymeal futures on the Dalian Commodity Exchange for May delivery fell 4.86% to 3,485 yuan ($539.57) per tonne following four days of gains, amid worries the new pig disease cases would hit demand for the major feed ingredient.<\/p>\n
\u201cPrices were rising mainly because soybean cargoes would be limited in March, and people did not think the African swine fever outbreaks were that severe,\u201d said a manager with a meat producer in northern China.<\/p>\n
\u201cBut then as more surveys were carried out in the industry, the market found that disease is really bad,\u201d said the manager, who declined to be named as he was not authorized to talk to the media.<\/p>\n
Chinese crushers were expected to cut operations in March due to limited supplies as rains in top exporter Brazil delayed harvests and shipments.<\/p>\n
\u201cThere is also some profit taking, which is quite normal,\u201d said Wang Xiaoyang, senior analyst with Sinolink Futures.<\/p>\n
\u201cAlso the African swine fever (ASF) disease is indeed very severe and there are signs that outbreaks are spreading from the north to the south.\u201d<\/p>\n
Falling Chicago soybean futures following lower U.S. export sales pressured domestic soymeal prices as well, traders said.<\/p>\n
\u201cNot-as-expected USDA weekly export sales data further stimulated the willingness of long investors to leave the market, resulting in falling soybean meal prices today,\u201d said a Shanghai-based senior trader.<\/p>\n
\u201cThe downstream demand for soybean meal has been suppressed with the spread of ASF, the sale of unhealthy pigs, and a traditional breeding off-seasons.\u201d<\/p>\n
Reuters reported in early February on a surge of ASF outbreaks in northeast and northern provinces, hurting pig production even as the country strived to rebuild its massive herd.<\/p>\n