Soybean Oil Stocks and Amounts in Outstanding Contracts in China (Week 11, 2018)

2018-03-20 www.cofeed.com

According to Cofeed, the latest statistics of soybean oil stocks and amounts in outstanding contracts in Chinese major areas in week 11 (till March 16th, hereinafter referred to this week) are shown as follows:

Unit：10,000 tonnes

Area/Item	Soybean oil stocks			Soybean oil in outstanding contracts
	Week 11	Week 10	Variation	Week 11	Week 10	Variation
Northeast	3.63	3.38	0.25	7.9	7.05	0.85
North China	25.22	27.07	-1.85	17.11	18.4	-1.29
Shandong	10.43	9.89	0.54	5.24	5.246	-0.006
East China	46.65	44.5	2.15	26.95	27.45	-0.5
Guangdong	16.105	16.745	-0.64	16.566	16.687	-0.121
Guangxi	14.265	13.84	0.425	17.35	13.28	4.07
Fujian	6.2	6.4	-0.2	4.27	4.25	0.02
Henan	2.65	3.18	-0.53	0.87	0.84	0.03
Sichuan	5.05	4.46	0.59	3.6	3.19	0.41
Others	10.25	9.7	0.55	1.28	1.14	0.14
Total	140.45	139.165	1.285	101.136	97.533	3.603

Comments: soybean oil again piles up in stocks, and according to Cofeed, soybean oil in China's business inventories till March 16th has accumulated to 1,404,500 tonnes from 1,391,650 tonnes on the week by 0.92% and 12,850 tonnes above by comparison. Additionally, the figure is up 26.69% from 1,108,600 tonnes with a growth of 295,900 tonnes on a year-on-year basis and no comparison figure for the same week last month due to the Chinese holidays. On the very note, average stocks of soybean oil in recent five years are around 977,400 tonnes.

Since operating rate is slightly lifted in China’s oil mills this week, national soybean crush now amounts to 1,819,000 tonnes (1,416,105 tonnes of soybean meal, 327,420 tonnes of soybean oil), up 0.82% or 14,800 tonnes above from 1,804,200 tonnes last week, according to Cofeed. Meantime, soybean processing capacity utilization is enhanced to 53.27%, 0.44 percentage points higher than 52.83% last week. On the whole, soybean crush this week is still lower than expected for haze in North China during China’s two sessions forces part of oil mills to stop operation for the sake of environmental protection. Additionally, a general overhaul may be started during mid-to-late March, lasting for half or one month, and in this case, weekly crush in the following two weeks may be around 1.73 Mln tonnes and 1.86 Mln tonnes respectively.

If judging from the current operating rate, Cofeed calculates that soybean crush nationwide in March are around 7.27 Mln tonnes, higher than last month’s 4.255 Mln tonnes as well as 6.6984 Mln tonnes on a year-on-year basis. Generally speaking, soybean arrivals estimates in the second quarter will be substantially great, in detail, 8.3 Mln tonnes in April, 9.3 Mln tonnes in May and 10 Mln tonnes in June. On the very note, stock pressure in the near future can never be underestimated irrespective of lifted operating rate.

Figure: Comparison of domestic soybean oil stocks in recent years

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