Today (Dec. 5th), the market for oilseeds and oils in China is shown as follows:
Oilseeds:
Imported soybean: Imported soybean price keeps steady today, among which Non-GM Canadian soybean is not offered for out of stock, Russian soybean is 3,400-3,450 yuan/tonne, and GM soybean is not offered. What’s more even concerning is whether there will be any official news that the 28% of soybean import tariffs will be revised to 3% now that China has agreed to purchase US agricultural products. If the tariff is revised, distribution market of imported soybean will probably slump; but if not, the market will edge up under tight supply. In such an uncertain case, distribution market of imported soybean will largely stay stable to fluctuate narrowly in the short term.
Cottonseed: Domestic oil and meal markets continue to go weak, and oil mills remain cautious in purchasing and some have even stopped purchase in face of the rough market. Therefore, cottonseed price falls by 0.01 yuan/kg under bad performance. But the overall price decline is restricted amid a small volume from Xinjiang due to ginning plants’ sentiment in hoarding and expensive freights. On the whole, short-term cottonseed market will probably fluctuate narrowly to go weak, and buyers can take hand-to-mouth buying.
Oils:
Summary: US soybean extended its gains overnight amid growing hopes that China may restore its US soybean purchases soon. Meals on the Dalian Commodity Exchange (DCE) fluctuate to adjust today, and soybean oil and palm oil are both in fluctuation and trade a little. The future of trade relationship between the US and China is still uncertain amid the negotiations in the next three months, after which if trade disputes may escalate if no deal is reached. And it is still unknown whether China will lift the additional tariff on soybean imports from 28% to 3%. Besides, the stockpile of small packing oil will gradually start from mid-to-late this month. Therefore, oil market is more resilient than soybean meal now as the market is supporting the price. But the trade truce is no doubt bearish to domestic market. On the other side, domestic oil is still in an oversupply pattern and weak in posting rebounds. Therefore, short-term oils is predicted to present weak fluctuations. Buyers can just take hand-to-mouth basis amid the trade uncertainties.
Soybean oil: GB Grade I soybean oil is mainly priced at 5,230-5,420 yuan/tonne in domestic coastal areas, fluctuating by 10-20 yuan/tonne partially. (Tianjin 5,320-5,330, Rizhao 5,400, Zhangjiagang 5,420, and Guangzhou 5,230-5,240).
Palm oil: 24-degree palm oil is mainly priced at 4,160-4,340 yuan/tonne in coastal areas, mostly down 10-30 yuan/tonne. (Tianjin 4,320-4,330, unchanged; Rizhao 4,340, up 10; Zhangjiagang 4,290, up 10; Guangzhou 4,160, unchanged; Xiamen 4,280, up 30).
Imported rapeseed oil: The price for imported rapeseed oil stays stable to edge up today, of which it is 6,150-6,380 yuan/tonne in coastal areas, up by 20-30 yuan/tonne partially. (Fujian not offered; Guangdong 6,290, up 30; Guangxi 6,170, up 20). While the crush volume has sharply dropped recently,the stockpile of small packing oil will gradually start from mid-to-late December. Besides, it is still uncertain whether the US and China will manage to reach a deal within three months. Therefore, rapeseed oil price is supported to stop falling currently. But the bearish aspects from the trade detente still exist and soybean oil and rapeseed oil are still in an oversupply pattern, so short-term rapeseed oil market will probably show weak fluctuations. Buyers can just wait or buy upon demand amid the uncertainties.
Cottonseed oil: Futures for oils on the DCE post resilience today. Soybean oil spots fluctuate by 10-20 yuan/tonne, and cottonseed oil stays stable and some GB Grade II cottonseed oil prices increase by 50 yuan/tonne. The price decline is limited by its small output and low prices, in addition to the uncertainties in the trade war. But its market is still negative amid low trading volume as the blend demand is restricted by the ongoing oversupply of bulk oils. On the whole, cottonseed oil market may maintain weak fluctuations in the short term, and market participants can keep watching whether China is to restore US soybean import.
(USD $1=CNY 6.87)
