HONG KONG (March 19 2003) - Beijing has not yet issued import permits forBrazilian soya, stoking fears the government may be trying to cut inflowsof foreign beans many fear China has overbought, traders said on Tuesday.

They said time was running out to secure the documents necessary as thefirst Brazilian soya cargoes this season are to set sail shortly forarrival in April.

"As far as we know, we might get it (the permits) before the end of thisweek," said a trader at an international house based in Shanghai. "Thetime is very tight."

To discharge foreign soya cargoes, importers need to acquire another setof documents from China's inspection and quarantine bureau after theMinistry of Agriculture (MOA) hands out import permits to suppliers.

Some traders were already in Beijing, waiting nervously for the MOA todistribute the first batch of import permits, which were initiallyexpected last week.

"We haven't seen any evidence that they are trying to slow downdeliberately.

They are making the excuse that they are moving the office," said anothertrader.

"(But) it's quite confusing. They seem to be moving the office every 2-3months."

Beijing, which has promised to open its doors to soya from Brazil, beganaccepting applications for the licences early in February under the latestrules on imports of transgenic crops.

IMPORT LIMITS: Traders said there was now market talk that CIQ was tolimit 2002-03 soya imports to 12 million tonnes, compared with 16 milliontonnes or more they estimate China has already bought for deliveries inthe current marketing year ending September 30.

"I heard CIQ will control it (imports) to about 12 million tonnes," said atrader at an international house in Shanghai.

"I foresee a big trouble because actual imports will easily exceed 16 or17 million or higher. What will those importers do?. Maybe there will be alot of washouts."

The first trader added: "The ceiling can be set higher than that quantity.

Still we are wondering whether CIQ can allow so much quantity into China.We doubt it."

The traders said, however, China continued to buy soyaoil from SouthAmerica, with another 30,000 tonnes done last week pushing total purchasesthis year to about 850,000 tonnes.

"They (the market) expect oil imports could rise to 1.4-1.5 million tonnesthis crop year. We are not sure where the oil market will go when soyaoilarrives."

The US Department of Agriculture revised upwards in March its forecast forChinese 2002-03 soyaoil imports to 1.1 million tonnes from 900,000 tonnespreviously. Its 2001-02 imports stood at 370,000 tonnes.

Asked about oil, the first trader said: "My personal view is that mealwill face more trouble.

China lacks oil. Domestic production cannot satisfy consumption."

With soft meal prices squeezing crushing margins over the past severalweeks, traders said many plants have now wound down or stopped operationsahead of the arrival of low-priced soyabeans from South America.- Reuters