Soybean meal and rapeseed futures in China rose sharply on Monday as the market responded to an academic report detailing the successful trial of a potential African swine fever (ASF) vaccine.
A medical team from the Chinese Academy of Agricultural Sciences (CAAS) successfully tested the ASF vaccine, releasing their findings in a research paper published in the journal Science China.
“Our study shows that HLJ/-18-7GD is a safe and effective vaccine against ASF and, as such, should play an important role in controlling the spread of ASF,” the paper stated.
The virus has killed millions of pigs in China since August 2018, when it was first identified, and quickly spread to claim millions more pigs in neighboring Vietnam before spreading to other countries.
The report was enough to push soybean meal and rapeseed meal futures – main sources of protein in animal feed – to hit a multi-month high on Monday.
The most liquid soybean flour futures on the Dalian Commodity Exchange rose nearly 4% from Friday, reaching a two-month increase at CNY2,719/mt (US $390.66/mt).
For rapeseed meals, the most active futures on the Zhengzhou Commodity Exchange rose to the highest level in four months at CNY2,370/mt (US $ 340.52/mt).
“These facts demonstrate that ASF cannot be controlled by eliminating infected pigs alone, and the development and application of an effective vaccine is urgently needed,” the article added.
However, the rollout and use of this vaccine across the market is still a long way off, with researchers emphasizing that it is still early days and that there are still uncertainties ahead.
“The media had a misleading interpretation of the results,” said Zhu Zengyong, a researcher at CAAS, referring to the early media coverage that accompanied early reports of the vaccine.
“Vaccine research and application still has uncertainty in the future,” Zhu said.
Many market sources also believe the rally lacks strong fundamental support.
“The demonstration was started by the vaccine rumor, but it was discarded. Today there were repercussions in the stock and commodity markets, along with a correction in crushing margins,” said an analyst at a major Chinese crusher.
“The uptrend today was unreasonable. It exceeded expectations,” a soybean meal purchasing manager told Agricensus, adding that low soybean ship arrivals and decent soybean meal demand may have supported the future.
Source: Agricensus
