Today (Oct. 26th), the market for oilseeds and oils in China is shown as follows:
Oilseeds:
Imported soybean: Imported soybean is quoted steadily today, of which non-GM Canadian soybean is 4,180 yuan/tonne and Russian soybean is 3,650 yuan/tonne, both holding the line of yesterday. And GM imported soybean is not offered. Due to the ongoing US-China trade frictions, soybean import volume is forecast to be less than 18 Mln tonnes in November to January, far lower that of the same period last year. Worried about inadequate supply in later market, importers show strong willingness to support prices. Nevertheless, the price advantage of imported soybean turns invisible due to its narrowed spread with domestic soybean, so its shipment is blocked. Besides, its distribution markets have little potential for further rises due to the abundant supply currently. Generally, facing the competition of trade war and market supply & demand, imported soybean distribution markets may largely remain stable despite fluctuations.
Cottonseed: Cottonseed edges down by 0.02-0.04 yuan/kg partially today, for its by-product markets have fallen back and oil mills remains 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 buy as required.
Oils:
Summary: US soybean extended its loss last night, but oils on Dalian Commodity Exchange (DCE) present slight gains today on the back of crude oil rebounds. Both soybean oil and palm oil spots welcome rebounds partially in China today, trading flat despite some purchases at lows. Soybean oil stock stays at a high level of 1.85 Mln tonnes, but the demand outlook gets clouded for the constant callbacks of its futures. Under such an oversupply pattern, oil spots falters to rebound. However, the US-China trade war has dented soybean supply for December to February, while packing-oil stockpiles before the Spring Festival will gradually get started in December, so soybean oil stock may welcome an inflection point at that occasion. Overall, oil market may remain an upward trend despite fluctuations at its bottom amid the ongoing trade spat, and buyers can make moderate replenishment on the dips, but not force up the price excessively.
Soybean oil: GB Grade I soybean oil in domestic coastal areas is mainly quoted at 5,550-5,600 yuan/tonne, among which some rebound by 30-50 yuan/tonne (Tianjin traders 5,560-5,570 yuan/tonne, Rizhao 5,560, Zhangjiagang 5,600 and Guangzhou 5,550-5,560).
Palm oil: 24-degree palm oil in coastal areas is mainly priced at 4,650-4,730 yuan/tonne, up by 20 yuan/tonne partially (Tianjin 4,720-4,730, up 10; Rizhao not offered; Zhangjiagang 4,700, unchanged; Guangzhou 4,650-4,680, up 20; Xiamen not offered).
Imported rapeseed oil: The price for imported rapeseed oil keeps steadily to rise today, among which it is 6,230-6,400 yuan/tonne in coastal areas, up 10-20 yuan/tonne. (Fujian not offered; Guangdong 6,420, up 40; Guangxi 6,350, up 50). Market participants are bullish about oil later market as soybean imports in the next three months will be far lower than in previous years due to trade conflicts. However, biodiesel offers thinner profits after crude oil slumps, and oil market is now in oversupply due to large inventories of soybean oil and rapeseed oil. Besides, there will be a meeting between China and the US presidents in late November. Therefore, rapeseed oil market is forced to extend fluctuations in the short run. But it will see limited space for declines and may remain its upward pace despite fluctuations at its bottom before trade conflicts ease. Buyers are suggested not to force price higher, but to replenish properly on the dips.
Cottonseed oil: Cottonseed oil falls by 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 rebound by 10-40 yuan/tonne partially 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 may extend its narrow fluctuations in the near term, so buyers can just wait on the sidelines.
(USD $1=CNY 6.95)
