Today ( Oct. 29th), the market for meals in China is shown as follows:
Soybean meal: US soybean closed higher last Friday, but meals on DCE pare gains amid low opens, and domestic soybean meal remains steady to fall and trade flat. Several factors have conspired to knock the market down today. First, Chinese government has released two standards on feed formula to lower the lower limits of protein content and to set upper limits to protein content. According to China Feed Industry Association, the new standards will reduce the use of soybean meal by 11 Mln tonnes. And 29 large enterprises have made commitments to carry out the new standards. Secondly, after the ban removal, India declared that some 500,000 tonnes of rapeseed meal will be imported to China annually. Still, African swine fever is frequently broken out nationwide. The prices in coastal areas range from 3,490-3,590 yuan/tonne, a steady fall of 10-20 yuan/tonne against yesterday (Tianjin 3,520, Shandong 3,490-3,540, Jiangsu 3,540-3,560, Dongguan 3,570-3,590, Guangxi 3,580-3,590). But the new standards are just non-mandatory, so decisions will be based mostly on cost performance of soybean meal, whose later market is counting largely on the trade war trend. Market participants are bullish about soybean meal market amid the trade war, during which soybean meal will have limited room for declines and may see-saw narrowly on the back of futures. But the price will be lifted once the trade frictions escalate, and one key point will be the meeting between the US and China presidents late next month. In addition, after Brazil’s right-wing candidate Jair Bolsonaro won the presidential run-off, the currency exchange of the real is bullish, which is bearish for the country to export soybean. Buyers can just wait on the sidelines and make moderate replenishment on the dips after steady falls.
Imported rapeseed meal: Price for imported rapeseed meal remains steady to fluctuate today, among which it is 2,630-2,700 yuan/tonne in coastal areas, steadily fluctuating by 10-20 yuan/tonne (Guangxi 2,630 yuan/tonnes, up 10; Guangdong 2,660, down 20; Zhangzhou Chinetex, Fujian 2,700, up 20). Currently, rapeseed meal stock has risen to 4,300 tonnes, yet still lower-than-normal. In addition, soybean supply gaps will exist amid trade spats, and demand for rapeseed meal has been enlarged due to its lower price than soybean meal. Hence, rapeseed meal market will likely go upside amid trade disputes, but it may fluctuate frequently for slack demand from aquaculture and meeting between China and the US presidents on G20 Summit in late November. So buyers can just take hand-to-mouth basis.
Imported fishmeal: Today, imported fishmeal is quoted steadily and can be traded with price negotiations, with normal 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 11,600-11,800 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 58,000 tonnes, Fuzhou 39,000 tonnes, Shanghai 57,000 tonnes, Tianjin 1,000 tonnes, Dalian 10,000 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, and prime with 68% protein content is 1,620 USD/tonne. Demand for fishmeal is turning pale, while market participants are waiting for new fishing quotas notice by Peruvian government, so the overall market will probably present a stable status in the near term.
Cottonseed meal: Soybean meal spots fall by 10-20 yuan/tonne as Chinese government has released new standards aiming lower down soybean meal demand. And cottonseed meal falls another 50-100 yuan/tonnes due to its poor trading performance and the contagious African swine fever. Generally, cottonseed meal price will fall back to consolidate with the increasing amount of new cottonseed meal on the market. But meal market will probably go upside once trade frictions escalate, and cottonseed meal will grasp the opportunity amid its increasing demand due to the enlarged price spread and its tight supply.
(USD $1=CNY 6.96)
