Today (Dec. 6th), 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. Bloomberg news said that China has begun preparing to restart imports of U.S. soybeans and liquefied natural gas to confirm the?claims?of the US President Donald Trump, but it is unknown whether China would cut relative tariffs. And it is possible that Beijing could?reimburse?buyers for the tariffs they pay. In addition, Brazilian farmers are poised to harvest their soybeans later this month thanks to the favorable growth conditions. The overall distribution market of imported soybean looks fatigued and weak against the background of the US and China trade detente, and may steadily fluctuate to go weak recently.
Cottonseed: Oil mills are hard to move on under ongoing poor performance of cottonseed oil and meal so that they are hesitant to purchase and some have already powered off their machines. This definitely harms cottonseed market. However, the volume available from Xinjiang to other parts of China is small when ginning plants are reluctant to sell, in addition to high freight cost; hence, the price will not drop further. Overall, short-term cottonseed market will probably present narrow fluctuations to go weak, and buyers can just wait on the sidelines.
Oils:
Summary: Bloomberg reported China has begun preparing to restart imports of U.S. soybeans and liquefied natural gas, the first signal to confirm the White House declaration that China has agreed to start buying some U.S. products immediately. In this context, US soybean posted gains for four consecutive sessions. However, such a trade truce is bearish to domestic oil market, especially when oil is in an oversupply state. Besides, the market has been raising its forecast for the output of Brazilian soybean, which is to be harvested later this month. Therefore, oils on the Dalian Commodity Exchange (DCE) fluctuate to drop today. And in spots market, domestic soybean oil and palm oil both slip with a small trading volume overall, in spite of some deals at low prices. But oils have already in the low price territory, while stockpile for small packing oil will gradually start from the mid-to-late December; thus, it will help restrict the room for price declines. Overall, short-term oil spots may show weak fluctuations on the back of futures, and buyers can take hand-to-mouth basis.
Soybean oil: GB Grade I soybean oil is mainly priced at 5,210-5,380 yuan/tonne in domestic coastal areas, down by 20-50 yuan/tonne partially. (Tianjin 5,300-5,310, Rizhao 5,360, Zhangjiagang 5,380, and Guangzhou 5,210).
Palm oil: 24-degree palm oil is mainly priced at 4,160-4,340 yuan/tonne in coastal areas, down 10-20 yuan/tonne. (Tianjin 4,300-4,310, down 20; Rizhao 4,340; Zhangjiagang 4,280, down 10; Guangzhou 4,160; Xiamen 4,270, down 10).
Imported rapeseed oil: The price for imported rapeseed oil goes up today, of which it is 6,170-6,430 yuan/tonne in coastal areas, up 10-50 yuan/tonne (Fujian not offered; Guangdong 6,300, up 10; Guangxi 6,200, up 30). Compared to higher-yield beans and palm oil, rapeseed oil shows more potential to rise under a continuous production cut of rapeseed globally so that investment funds are in favor of rapeseed oil futures. In this case, rapeseed oil market has got support. But in view of an oversupply of soybean oil and rapeseed oil, there is limited space to rebound in the short term. Buyers are suggested to make proper replenishment on the dips, but not to chase up the price excessively.
Cottonseed oil: Cottonseed oil price stays stable today, for oil mills are supporting the price amid low output and low prices, in addition to the uncertainties in trade frictions. But oils on the DCE fluctuate to drop today, and soybean oil spots also fall by 20-50 yuan/tonne under an oversupply pattern. So cottonseed oil market gets curbed as its deals are unobserved under limited blend usage. Overall, cottonseed oil may post weak fluctuations in the near term, and buyers can keep watching whether China will restart US soybean imports.
(USD $1=CNY 6.87)
