Comments: soybean oil extends falls in stocks this week, and according to Cofeed, soybean oil in China's business inventories till March 2nd has been shriveled from 1,415,850 tonnes last week to 1,394,800 tonnes by 1.49% and 21,050 tonnes below by comparison. Additionally, the figure is down 6.07% from 1,485,000 tonnes the same week last month with a reduction of 90,200 tonnes, but up 24.78% or 277,000 tonnes above as compared to 1,117,800 tonnes the corresponding week of year 2017. On the very note, average stocks of soybean oil in recent five years are around 970,380 tonnes.
Operating rate in domestic oil mills recovers in a slower pace after Chinese holidays, as a consequence, national soybean crush in week 9 totals around 1,441,200 tonnes (1,145,754 tonnes of soybean meal, 259,416 tonnes of soybean oil), a surprising growth of 473.49% or 1,189,900 tonnes as compared to 251,300 tonnes attained in week 8 (Feb. 17th- 23rd). Soybean crush capacity utilization in week 9 is increased to 42.20%, 34.84 percentage points higher than 7.36% in week 8. Generally, soybean crush in oil mills is still not large even though operating rate is somewhat lifted, additionally, US soybeans jump significantly under the impact of Argentina’s dryness, which therefore boosts market confidence with continuous rises of oil futures at home and abroad. Sales of soybean oil in week 9 are quite good with daily turnover reaching 27,320 tonnes, and normally, daily turnover is almost pegged at 20,000 tonnes in most oil mills, which then contributes to the decreasing soybean oil stocks this week.
However, driven by soaring domestic oil and meal prices in time of good crush margins and delivery, soybean processing rate is further lifted with weekly crush estimates around 1.88 Mln tonnes and 1.97 Mln tonnes respectively. That may also limit stock decline in later period. Generally speaking, soybean arrivals in April-to-May period may keep rising with estimates around 8.7 Mln tonnes and 9.3 Mln tonnes respectively, besides, soybean processing rate in the second quarter will keep exceedingly high backed by sufficient soybean supplies. Honestly, supply pressure on oils is still considerable even in the long run.
Unit: 10,000 tonnes
|
Area/Enterprise
|
Soybean oil stocks
|
Soybean oil in outstanding contracts
|
|
|
Week 9
|
Week 8
|
Variation
|
Week 9
|
Week 8
|
Variation
|
|
Northeast China
|
2.9
|
3.66
|
-0.76
|
5.75
|
5.62
|
0.13
|
|
North China
|
27.14
|
26.62
|
0.52
|
15.16
|
15.7
|
-0.54
|
|
Shandong
|
9.59
|
9.985
|
-0.395
|
4.96
|
5.25
|
-0.29
|
|
East China
|
45.25
|
45.46
|
-0.21
|
24.8
|
23.8
|
1
|
|
Guangdong
|
17.555
|
17.85
|
-0.295
|
16.085
|
16.49
|
-0.405
|
|
Guangxi
|
13.76
|
14.05
|
-0.29
|
13.95
|
7.3
|
6.65
|
|
Fujian
|
6.3
|
7
|
-0.7
|
4.5
|
3.8
|
0.7
|
|
Henan
|
3.265
|
2.36
|
0.905
|
0.59
|
0.62
|
-0.03
|
|
Sichuan
|
4.3
|
4.55
|
-0.25
|
3.1
|
2.6
|
0.5
|
|
Others
|
9.42
|
10.05
|
-0.63
|
1.01
|
1.08
|
-0.07
|
|
Total
|
139.48
|
141.585
|
-2.105
|
89.905
|
82.26
|
7.645
|
Figure: Comparison of domestic soybean oil stocks in recent years
