Today (Oct. 22nd), the market for oilseeds and oils in China is shown as follows:
Oilseeds:
Imported soybean: Imported soybean is quoted higher today, of which non-GM Canadian soybean is 4,180 yuan/tonne, up 130 from last Friday, Russian soybean is 3,650 yuan/tonne, 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 distributed markets have little potential for further rises due to abundant supply currently. Generally, facing the competition of trade war and market supply & demand, imported soybean distribution markets may largely remain stable from fluctuations.
Cottonseed: Cottonseed steps down partially by 0.02-0.04 yuan/kg today, due to its weak by-product markets and oil mills’ (some have stopped their purchase) caution against purchasing high-priced cottonseed amid thin crush margins and increased amount of new cottonseed on the market. But the cottonseed market is still supported by the ongoing trade conflicts and small volume from Xinjiang under inconvenient transportation and expensive freight. And the short-term cottonseed market is predicted to fluctuate narrowly, so buyers can just buy on hand-to-mouth basis.
Oils:
Summary: US market extended its losses last Friday after China canceled sizable preliminary orders for US soybean. Domestically, the arbitrage of buying oils and selling meals is brisked up, so oils on DCE fluctuate to edge up. And oil spots are mostly stable, of which soybean oil and palm oil fluctuate steadily and trade quietly. Soybean crush volume in domestic oil mills has increased to 1.96 Mln tonnes by 13% last week, and will remain at a high level in the next two weeks, of which soybean oil stock has moved to a new high of 1.83 Mln tonnes. Given this, plus the declines of crude oil, oil market is still bearing pressure from fundamentals. But there is little chance to end trade conflicts in the near term, so later soybean imports will be fewer, with only less than 18 Mln tonnes in November to January, far lower than 26.7 Mln tonnes of the same period in previous year. Under this, oil mills are supporting the price, so oils will have limited room for price callbacks in the near term, and may trend up gradually despite the fluctuations at its bottom before trade war ends. In view of the current fluctuations, buyers can just buy on a hand-to-mouth basis.
Soybean oil: GB Grade I soybean oil in domestic coastal areas is mainly quoted at 5,630-5,700 yuan/tonne, fluctuating by 10-20 yuan/tonne partially (Tianjin traders 5,630-5,640 yuan/tonne, Rizhao 5,640, Zhangjiagang 5,700 and Guangzhou 5,630).
Palm oil: Palm oil of 24-degree melting point in coastal areas is mainly priced at 4,760-4,830 yuan/tonne, mostly up 10-20 (Tianjin 4,770-4,780, up 10; Rizhao not offered; Zhangjiagang 4,770, up 20; Guangzhou 4,670; Xiamen 4,830, up 20).
Imported rapeseed oil: Today imported rapeseed oil market edges up. Its quotation in coastal areas is mainly at 6,390-6,560 yuan/tonne, up 10-20 partially (Fujian not quoted; Dongguan Shenheng, Guangdong 6,360; Fangchenggang Maple, Guangxi 6,380). The upside room for imported rapeseed oil is now restricted by the weak fundamentals, for soybean oil stock has climbed to a new historical high of 1.83 Mln tonnes, though rapeseed oil stock has dwindled to 490,000 tonnes. But rapeseed oil will trend up despite fluctuations at its bottom before trade tensions ease. Merely, the market volatility gets exaggerating due to the news of a meeting between US and China presidents late next month and an intensive sale of 6 Mln tonnes of soybean early next year, so buyers can just wait and replenish properly at low upon steady falls.
Cottonseed oil: Today, soybean oil spots fluctuate by 10-20 yuan/tonne in a steady pace. And due to the high fundamental pressure in bulk oils, as well as its low end demand amid the increased volume of new cottonseed oil on the market, cottonseed oil loses 50 yuan/tonne partially. However, cottonseed oil still sees little room for declines, as forward soybean supply will fall short amid the ongoing trade spat, in addition that oil mills are still reluctant to sell out amid the tight supply at low price in years. Short-term cottonseed oil market may extend to fluctuate narrowly, so buyers can just buy on a hand-to-mouth basis.
(USD $1=CNY 6.93)
