Today (Oct. 29th), the market for oilseeds and oils in China is shown as follows:
Oilseeds:
Imported soybean: Imported soybean quotation remains steady today, of which non-GM Canadian soybean is not offered for out of stock and Russian soybean is unchanged from last Friday at 3,650 yuan/tonne. And GM soybean is not offered. Amid the ongoing US-China trade frictions, according to the latest statistics by Cofeed, imported soybean at port is projected at 6.399 Mln tonnes boarded 102 ships to domestic ports in October, and probably only 17.1 Mln for November to January due to the cancellation of some ships for US soybean. The volume is far lower than that of the same period last year, of which it is 8.6842 Mln tonnes, 9.55 Mln tonnes and 8.48 Mln tonnes for November, December and January, respectively. Importers have a strong will to support the price as market participants show concerns over the soybean supply on later market. But imported soybean market is dented by its weak price performance due to its narrow price spread with domestic soybean. In general, as trade conflicts are yet to ease, imported soybean distribution markets may largely remain stable despite fluctuations on worries of forward supply.
Cottonseed: Cottonseed edges down by 0.01-0.02 yuan/kg partially today, for both cottonseed oil and cottonseed meal markets keep dropping and oil mills remain cautious in purchasing high-priced cottonseed and take the hand-to-mouth basis amid dismal crush margins and the increasing amount of new cottonseed. But the trade spat is yet to ease, and there is just a small volume of cottonseed from Xinjiang under transportation strains and expensive freight, so there is little room for cottonseed price to drop. Overall, cottonseed price may fluctuate narrowly to consolidate in the short term, so buyers can just wait on the sidelines.
Oils:
Summary: US soybean rebounded slightly last Friday. Today oils on Dalian Commodity Exchange (DCE) fluctuate narrowly, and domestic spot prices of soybean oil and palm oil remain steady to gain and trade low. Crush volume has moved to a new weekly record of 2.01 Mln tonnes last week upon healthy crush margins, with soybean oil reaching a new high of 1.87 Mln tonnes, which continues to weigh on oil markets. But Chinese government has released new feed standards, which will reduce the use of soybean meal by 11 Mln tonnes, and 29 feed enterprises have committed to carry out the standards. Under such circumstance, soybean crush volume will drop, which will be bullish to oil market. On the other hand, operation rate may decline later as oilseed supply gets tight from December to February amid trade conflicts, while stockpiles for packing oil in the run-up to Chinese New Year will gradually start in December. Therefore, oil market will have small slump potential, and may extend its slow upside trend despite the bottom fluctuations in the long term. Buyers can replenish properly after steady falls.
Soybean oil: GB Grade I soybean oil in domestic coastal areas is mainly quoted at 5,550-5,600 yuan/tonne, rising by 10-20 yuan/tonne partially (Tianjin traders 5,560-5,570 yuan/tonne, Rizhao 5,550, Zhangjiagang 5,600 and Guangzhou 5,550-5,560).
Palm oil: 24-degree palm oil in coastal areas is mainly priced at 4,630-4,720 yuan/tonne, up by 20 partially (Tianjin 4,710-4,720, unchanged; Rizhao not offered; Zhangjiagang 4,720, up 20; Guangzhou 4,630-4,650, unchanged; Xiamen not offered).
Imported rapeseed oil: Today imported rapeseed oil price fluctuates steadily. Its quotation in coastal areas is at 6,230-6,400 yuan/tonne, up 10-20 (Zhangzhou Chintex, Fujian not quoted; Guangdong 6,390, down 30, Guangxi 6350, stable). The upside potential of oil market is now overshadowed by following weak fundamentals: rapeseed oil stock has risen to 148,000 tonnes by 2% in South China and to 350,000 tonnes in East China last week, and soybean oil stock has climbed to a historical high of 1.87 Mln tonnes. And the market turns volatile further due to the news of a meeting between China and the US heads late next month. But Chinese government has released new standards to limit protein content in animal feed, so rapeseed oil will probably go upside despite fluctuations amid trade disputes, and buyers are suggested to replenish properly on the dips.
Cottonseed oil: Cottonseed oil loses another 50-100 yuan/tonne due to its limited terminal demand amid an increased amount of new cottonseed oil and vast inventories of bulk oils. But as forward soybean imports will be relatively small during the trade war, soybean refineries are supporting the price, pushing soybean oil spots to steadily increase by 10-20 yuan/tonne today. Besides, refineries show reluctance to sell their cottonseed oil at current small inventories and low prices, so cottonseed oil posts limited declines. In general, cottonseed oil price may continue to consolidate in fluctuations in the near term, so buyers can just wait on the sidelines.
(USD $1=CNY 6.96)
