BEIJING (Dow Jones)--China's annual soybean imports are likely to remain stable compared with last year as domestic demand is less price-elastic, a senior official with a government think tank said Tuesday.
"(China's) soybean imports have reached a very high level, and it's very hard (for the volume) to either rise largely or decline sharply," Han Jun, head of the Rural Economy Department at the State Council's Development Research Center, said during a press conference.
China imported 42.55 million metric tons of soybeans last year, up 14% from the previous year.
The government will continue to protect soybean farmers' interests through its purchasing policy and stick to the policy of selling the crop at prices higher than purchase prices, Han said.
If the government sells soybeans from its more than 7 million tons of reserves at prices cheaper than the purchase prices, local prices will come under pressure, he added.
"Then the only right choice is to ask local soybean crushers to participate in soybean purchases and meanwhile provide them with subsidies to prevent them from incurring too much losses" in competition with cheaper global soybeans,Han said.
Much cheaper global soybean prices and high government selling prices forced many local soybean crushers in the country's biggest producing areas in the northeast to stop production last year, and government subsidies later helped some crushers resume production.
The market is widely expecting South America to see a record soybean harvest from March, which will further plague soybean prices.