Today (Jan. 9th), 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. A rumor told that China had purchased 20-25 cargoes of US soybeans, which may send domestic soybean to grow in supply. Meanwhile, the market has been in a strong wait-and-see mood as trade talks between Beijing and Washington have been carrying on. In addition, the trading volume remains unobserved in the distribution market. Therefore, domestic soybean market is still curbed. Generally speaking, imported soybean price will likely stay stable with slight declines in fluctuation in distribution markets recently.
Cottonseed: Cottonseed performance in China today is supported by 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 is still 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 Trump tweeted that talks with China were going very well. Thus short-term cottonseed may fluctuate at a narrow range.
Oils:
Summary: US soybean slipped last night in a profit-taking, and today oils also slow down the upward pace on the Dalian Commodity Exchange. Soybean oil and palm oil both post a partial rise with some slight declines, and the trading volume is light as the market awaits the outcome of the U.S.-China talks. The production estimate on Brazilian soybean has been reduced upon the poor performance of its early-cut crops, and China for the first time in eighteen months has approved on Tuesday the import of five?GM?crops including soybean; hence, US soybean will probably go strong in the short term. The inventory of soybean oil has posted a steep decline to 1.56 Mln tonnes amid ongoing stockpiling before the festival and declining operation rate due to swelling soybean meal stocks, with a foreign-owned factory heavily buying soybean oil in East China recently. In addition, there have been soybean shortages in one certain country, and traders have begun to take the arbitrage of buying oils and selling meals. Domestic oil spot market is thus propped up by the strong trend of its futures. But Beijing and Washington have extended their trade talks into Wednesday amid the U.S. President Donald Trump’s tweet that “talks with China are going on well”. The market will turn bearish once any deal is reached, so buyers can keep an eye on the outcome.
Soybean oil: GB Grade I soybean oil is mainly priced at 5,300-5,550 yuan/tonne in domestic coastal areas, some up by 20-30 yuan/tonne and some down by 10 yuan/tonne. (Tianjin 5360-5370, Rizhao 5,300, Zhangjiagang 5,550, and Guangzhou 5,420-5,440).
Palm oil: 24-degree palm oil is mainly priced at 4,470-4,580 yuan/tonne in coastal areas, some up by 20 yuan/tonne. (Tianjin 4520-4530, up 20; Rizhao 4,550, up 20; Zhangjiagang 4,580; Guangzhou 4,470; and Xiamen not offered).
Imported rapeseed oil: The price for imported rapeseed oil remains basically stable today, of which it is 6,230-6,480 yuan/tonne in coastal areas. (Fujian not offered; Guangdong 6,350, stable; and Guangxi 6,350, stable). Inventories of rapeseed oil and soybean oil have both reduced upon declining operation rate due to swollen soybean meal stock and ongoing stockpiling before the festival. Several oil mills have run into problems in unloading their rapeseed amid relation tensions between China and Canada, including two Guangdong mills as mentioned before, two in Guangxi and one in Jiangsu, so oil mills have gradually begun to prop up the price. But the market bodes well for the outcome of trade talks which have entered a third day on Wednesday between Beijing and Washington amid the U.S. President Donald Trump’s tweet that “talks with China are going on well”. And domestic oil market will fall bearish once any deal is achieved, so the upward space is now curbed. Participants can wait for the guidance from the outcome of trade talks today.
Cottonseed oil: Today cottonseed oil prices partially rise 50 yuan/tonne when oils on DCE go up with fluctuations, soybean oil spots partially rise 20-30 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 US-China trade talks were extended until Wednesday and Trump tweeted that talks with China were going very well. If some agreements are reached, the China's oils market will turn negative. Add to this slow delivery of cottonseed oil and the upward potential is curbed amid some fall. Short-term cottonseed oil will move with strong momentum in narrow range.
(USD $1=CNY 6.84)
