Today (Jan. 18th), 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 is unchanged at 4,000 yuan/tonne, and non-GM Russian soybean is at 3,200 yuan/tonne and the GM is not offered. US soybean is buoyed to tick higher by technical selling and short-covering, as well as threatened Brazilian and Argentine crops under adverse weather in South American soybean planting areas. Nevertheless, domestic soybean market is still damped by sluggish shipments on the distribution market. Overall, imported soybean price will likely stay stable with slight declines in distribution market recently.
Cottonseed: The cottonseed market is limited by decreased demand for oil mills are cautious in purchasing and inactive in powering on their machines amid poor performance of cotton by-products, especially cottonseed meal. However, China's cottonseed market 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. Cottonseed prices is hard to rise or fall for present and in the short run may move in narrow range. Oil mills are suggested to take a hand-to-mouth buying strategy.
Oils:
Summary: US soybean and oils on the Dalian Commodity Exchange both post rebounds after the harvest forecast for Brazilian soybean was scaled back by 5 Mln tonnes due to stressful weather in South America. On the spot market, soybean oil goes up to see better trading at lows and few for those with big price rises, and palm oil also goes up in soft trading. Soybean oil stock has been reducing since operation rate has stayed at a low level due to swelling soybean meal stockpiles under the outbreaks of the African swine fever. Oil futures have thus consolidated under the arbitrage of buying oils and selling meals. Several cargoes of Canadian rapeseed and soybean have been sealed up and waiting for commodity inspections amid strained tensions between China and Canada, and operation rate has dropped sharply for this. In the meantime, stockpiling will continue for another week. As oil mills are propping up the price, short-term oil market will probably consolidate in fluctuation. However, demand will enter into the slack season after the Spring Festival. And US President Donald Trump said that the US and China will manage to strike a trade deal within the deadline for a truce on March 2nd. And China has pledged to import US farm commodities substantially, whilst it has carried out a plan to enlarge its planting area for soybean to 10 million Mu (1647369.21 acres). Therefore, there will be limited space for rises.
Soybean oil: GB Grade I soybean oil is priced at 5,480-5,620 yuan/tonne in domestic coastal areas, up by 20-80 yuan/tonne. (Tianjin 5,480-5,490, Rizhao 5,550, Zhangjiagang 5,620, and Guangzhou 5,480-5,510).
Palm oil: 24-degree palm oil is mainly priced at 4,510-4,620 yuan/tonne in coastal areas, up by 60-100 yuan/tonne. (Tianjin 4,560-4,570, up 60; Rizhao 4,620, up 100; Zhangjiagang 4,580, up 100; Guangzhou 4,510, up 80; and Xiamen not offered).
Imported rapeseed oil: The price for imported rapeseed oil edges up today, of which it is 6,250-6,460 yuan/tonne, up 20-30 yuan/tonne. (Fujian not offered; Guangdong not offered; and Guangxi 6,320, up 20). Amid tensions between China and Canada, five out of eight rapeseed cargoes are not allowed to go processed after unloaded, and the rest three arriving this week still stay at ports. Consequently, rapeseed oil market gets a boost from its declining stockpiles under sharp drops in rapeseed crush. But global soybean supply has been under pressure, and China and the U.S. will hold higher-level trade talks later this month. Therefore, rapeseed oil will have limited room for rises and may follow its futures to post frequent fluctuations. Buyers are suggested to replenish properly on the dips and be cautious in forcing up the price.
Cottonseed oil: Oils on DCE today rebound after sessions of declines while soybean oil spots go up 20-80 yuan/tonne. And cottonseed oil prices are supported due to oil mills' mindset to hold onto goods as the stockpiling before holiday is still underway, and prices of cottonseed oil hit a low of recent years with limited output. However, China's oils market is negative for there will be a higher-level US-China negotiation at the end of this month. Moreover, there is not obvious trading volume for cottonseed oil as blending oils. So its market is still curbed and short-term cottonseed oil prices are likely to move at a narrow range.
(USD $1=CNY 6.78)
