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Daily Review on Meal Market in China

2018-10-22 www.cofeed.com
      Today ( Oct. 22nd), the market for meals in China is shown as follows:
 
      Soybean meal: Subject to the loss of US soybean last Friday evening, as well as profit taking, meals on Dalian Commodity Exchange (DCE) slump today. Domestic soybean meal spots also slip and trade flat. The prices in coastal areas range from 3,500 to 3,600 yuan/tonne, down 20-50 yuan/tonne against last Friday. (Tianjin 3,540, Shandong 3,500-3,560, Jiangsu 3,530-3,580, Dongguan 3,600, Guangxi 3,580-3,600). Under current bumper crush profits, soybean crush volume is forecast to reach a high level of 1.90 Mln tonnes in the next few weeks. Meanwhile, hog replenishment is under the influence of African swine fever (ASF), and the increased substitute volume of mixed meal due to the widened price spread is also weighing on soybean meal demand. So soybean meal is forced to extend its callbacks. However, trade war is yet to end in the short term, so import soybean will decline in volume to less than 18 Mln tonnes in November to January, far lower than 26.7 Mln tonnes of the same period in previous year. As oil mills are still positive about later market, soybean meal will see limited room for callbacks, and may keep edging up despite fluctuations. Buyers can just wait and replenish properly on the dips after a steady fall.
 
      Imported rapeseed meal: Prices for imported rapeseed meal step down today, of which it is 2,620-2,700 yuan/tonnes in coastal areas, down 30-40 yuan/tonne (Fangchenggang Great Ocean 2,660, down 40; Dongguan Fuzhiyuan 2,700, down 30; Zhangzhou Chintex 2,700, down 20). Rapeseed meal sees callbacks upon a volatile market, where the rampant ASF is exerting an influence on hog replenishment, in addition to the news of a meeting between the US and China heads later next month. But rapeseed meal is now of tight supply, especially after its ratio in feed is increased due to the widened price spread with soybean meal. At the same time, there is little progress in settling the trade conflicts, so rapeseed meal market will seek to trend up during this period. Buyers can just wait and make proper replenishment on the dips after steady falls. 
 
       Imported fishmeal: Today, imported fishmeal is quoted steadily and can be traded by negotiations, with flat shipment at port. Northern ports: price is 10,600-10,700 yuan/tonne for Peruvian ordinary SD with 65% protein content, 11,500-11,700 yuan/tonne for Japanese SD with 67% protein content, and 11,700-11,900 yuan/tonne for super steam fishmeal with 68% protein content. Southern ports: price is 10,700 yuan/tonne for Peruvian ordinary SD with 65% protein content, 11,600 yuan/tonne for Japanese SD with 67% protein content, and 11,800 yuan/tonne for super steam fishmeal with 68% protein content. Stocks at port: Huangpu 56,000 tonnes, Fuzhou 40,000 tonnes, Shanghai 55,000 tonnes, Tianjin 1,000 tonnes, Dalian 8,000 tonnes, Fangchenggang 1,000 tonnes and 4,000 tonnes at other ports. Spot quotations (FOB) in foreign market keep stable: Peruvian ordinary SD fishmeal with 65% protein content is quoted at 1,330 USD/tonne, and 1,600 USD/tonne for super SD fishmeal with 68% protein content. Chilean ordinary fishmeal with 65% protein content is quoted at 1,510 USD/tonne, prime with 68% protein content is 1,620 USD/tonne. Lower demand for fishmeal domestically, as well as the investigation information in the new fishing season from Peru, is bearish to the overall market, so holders just wait on the sidelines and quote steadily. 
  
      Cottonseed meal: US soybean closed lower last Friday evening due to the improved weather for harvests and the order cancellation by China. Today meals on DCE slump. And the loss of soybean meal spots by 20-50 yuan/tonne, the dismal demand under ASF, and the slower pace in clinching new deals together force cottonseed meal to lose 30-70 yuan/tonne partially. However, the import cost for soybean remains high as there is little chance to end the trade war in the short term, so soybean meal market is propped up and hard to see slumps. Under such circumstance, cottonseed meal is much cheaper than soybean meal, coupled by its tight supply, so its price will take no plunge. It may keep trending up from fluctuations amid trade conflicts, but may swing to adjust with the increased volume of new cottonseed meal. By the way, buyers can just wait on the sidelines.
 
(USD $1=CNY 6.93)