Today (Jan. 7th), 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 and the GM old soybean levels off at 4,030 yuan/tonne, and non-GM Russian soybean is priced steadily at 3,270 yuan/tonne and the GM is not offered. Currently, soybean market is propped up by unfavorable crop weather in Brazil. But China officials are now meeting their US counterparts in Beijing amid upbeat?forecasts. Therefore, market participants are still trapped in strong wait-and-see sentiment. As a result, imported soybean market is impeded by slow shipments in distribution markets. Generally speaking, imported soybean price will likely go weak with fluctuations in distribution markets recently.
Cottonseed: The cottonseed prices in China today partially rise 0.02 yuan/kg, for the low trading of cotton ginning plants in view of less and less cottonseed supply and its current low prices as well as traffic tensions and expensive freight. But the market turns negative when oil mills are cautious in purchasing and inactive in powering on their machines amid slow delivery and weak pick-up of cotton by-products; and when the import tariffs on Australia cottonseed are removed according to the agreement between China and Australia. The prices of cottonseed from Xinjiang province fall 0.04 yuan/kg for the bad condition of transportation. Short-term cottonseed may fluctuate at a narrow range.
Oils:
Summary: US soybean extended its gains last Friday ahead of US-China trade talks and upon concerns over dry weather in Brazil. Today, oils cut their gains after higher opens on the Dalian Commodity Exchange, and oils broadly post modest rises in the spot market, of which domestic soybean oil and palm oil both go up to trade a little. Foreign market has got a boost as palm oil has entered into the production reduction in Southeast Asia. Soybean crush has fallen by 16% to 1.57 Mln tonnes after an unexpected decline in operation rate amid swelling soybean meal inventories, whilst soybean oil stock has dropped further for stockpiles before the Spring Festival. Therefore, oil market has enjoyed stronger support at its bottom. However, China and Australia have made a deal to exempt all tariff on almost all goods in bilateral trade from January 1st this year, according to the China-Australia Free Trade Agreement. Besides, the U.S. officials have met with their Chinese counterparts in Beijing this morning amid US President Donald Trump’s statement that the two countries would achieve a deal, for which US stock may reverse its recent slump to post a big rally. But the market with positive expectations also holds that the US will have a list of requirements to be met before reaching a deal. Oil market will fall bearish if the trade talk goes on well. Buyers are suggested to wait on the sidelines instead of driving up the price so as to avoid any risk from frequent fluctuations.
Soybean oil: GB Grade I soybean oil is mainly priced at 5,260-5,420 yuan/tonne in domestic coastal areas, another rise of 10-40 yuan/tonne. (Tianjin 5,270-5,280, Rizhao 5,300, Zhangjiagang 5,420, and Guangzhou 5,260-5,280).
Palm oil: 24-degree palm oil is mainly priced at 4,320-4,450 yuan/tonne in coastal areas, mostly up by 20 yuan/tonne. (Tianjin 4,390-4,400, up 20; Rizhao 4,450, up 20; Zhangjiagang 4,500, up 50; Guangzhou 4,320-4,330; and Xiamen 4,400, up 20).
Imported rapeseed oil: The price for imported rapeseed oil stays stable to inch higher, of which it is 6,250-6,450 yuan/tonne in coastal areas, steadily up by 10-20 yuan/tonne. (Fujian not offered; Guangdong 6,350, up 5; and Guangxi 6,350, stable). Oil mills have hastened to clear their inventories with the start of packing oil stockpiles before the festival, so that rapeseed oil stock has decreased by 3% to 525,000 tonnes in coastal areas last week. Rapeseed oil market is thereby propped up. But global soybean supply has been under heavy pressure. Besides, China officials are meeting their US counterparts in Beijing today and tomorrow amid positive expectation from the market, and once the trade deal is reached, domestic market will fall bearish. What’s more, almost all goods in bilateral trade have begun to enjoy zero tariffs between China and Australia from January 1st this year, according to the China-Australia Free Trade Agreement. In this case, rapeseed and its oil will stand a good chance of growth from Australia. Buyers are suggested not to force up the price excessively amid uncertainties in the trade talk.
Cottonseed oil: Today cottonseed oil prices partially rise 50-100 yuan/tonne when oils on DCE continue to go up, soybean oil spots rise 10-40 yuan/tonne, packing oil stockpiling is slowly getting underway, and prices of cottonseed oil hit a low of recent years amid limited output and trading of oil mills. But cottonseed oil delivery is still not much due to its limited blend amount under the existing stock pressure of bulk oils. Short-term cottonseed oil prices may be propped up by the stockpiling before holiday. However, if some agreements in the ongoing US-China trade talks in Beijing are reached, the China's oils market will turn negative. Buyer should pay attention to it and make proper replenishment upon lower prices, yet not chase bids high.
(USD $1=CNY 6.85)
