Soybean futures in China, the world's biggest buyer of the oilseed, posted the biggest weekly drop in more than three years on speculation that a global commodities sell-off will cut import costs.

Soybeans in Chicago lost 11 percent last week, helping erase all of this year's gains as large investors sold commodities to cover losses in other capital markets. Imported soybeans account for 70 percent of China's supplies, according to the China National Grain and Oils Information Center.

Nie Ben, manager at Liaoning Cifco Futures Co in Dalian, said: "We will see more losses by importers as prices slide further. This is extremely damaging to the industry."

January-delivery soybeans lost as much as 82 yuan (US$11.55), or two percent, to 4,007 yuan a metric ton. The contract closed at 4,056 yuan a ton, down 19 percent from a peak on March 4. The 10 percent loss last week was the biggest since September 17, 2004, Bloomberg News said. Soybean oil for September delivery gained 0.4 percent to close at 10,614 yuan a ton. May-delivery palm oil rose 0.1 percent to 9,866 yuan.

There are few buyers on the cash markets for vegetable oils even after prices fell as much as 300 yuan a ton last week, China National Grain said.

September-delivery corn on the Dalian exchange gained one percent to settle at 1,783 yuan a ton.

"I am cautiously optimistic about agricultural commodities," said Cheng Jie, analyst at research firm CNCotton.com. "The fundamentals point to a bull market."

(Shanghai Daily March 24, 2008)