Today (Jan. 25th), 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 futures rose upon a lower estimate for production of Brazilian soybean as the market remained worried about adverse weather in South America. However, global soybean supply is relatively loose at present, and domestic soybean market will be still damped by ongoing sluggish shipments on the distribution market as the year draws near. Overall, imported soybean price will likely stay stable with slight declines in distribution market recently.
Cottonseed: The cottonseed market is curbed by the cautious purchase of oil mills for stockpiling under the conditions of the serious cottonseed crush losses as well as the decreased demand for oil mills get ready for a machine halt when Lunar New Year is around the corner. However, China's cottonseed market is supported by the expensive freight, and the low trading of cotton ginning plants in view of less and less cottonseed supply. As the prices of products in downstream is more likely to rise than fall ahead of the holiday, short-term cottonseed is likely to strongly fluctuate. Oil mills may make small replenishment upon low prices if out of stock.
Oils:
Summary: US soybean extended its gains last night upon lower-than-forecast production of Brazilian soybean, and oil futures post modest rises on the Dalian Commodity Exchange today. On the spot market, soybean oil sees broad increases and palm oil partial hikes amid light trading, despite some continued purchase at low prices. Short-term US soybean may maintain narrow fluctuations with its own poor exports competing with soybean production threatened by adverse weather in South America. In China, traders continue to carry out the arbitrage of selling meals and buying oils for a possible 20% drops of live pig number under the rampant African swine fever, which helps support oil prices. Moreover, while soybean oil inventories have slumped to around 1.40 Mln tonnes amid the stockpiling before the festival, soybean arrival has dropped by 21% in the first quarter from a year earlier, under which its supply will get tight from March to the first half of April. The overall oil market will hold steady to consolidate before the Spring Festival. But as operation rate will rise back with the customs clearance of Canadian rapeseed for three coastal oil mills, in addition to the completion of stockpiles before the festival, there will also be limited upward space.
Soybean oil: GB Grade I soybean oil is priced at 5,610-5,740 yuan/tonne in domestic coastal areas, mostly up by 10-30 yuan/tonne. (Tianjin 5,650-5,660, Rizhao 5,660, Zhangjiagang 5,740, and Guangzhou 5,610-5,620).
Palm oil: 24-degree palm oil is mainly priced at 4,630-4,740 yuan/tonne in coastal areas, up by 10-20 yuan/tonne partially. (Tianjin 4,680-4,690, up 10; Rizhao 4,740; Zhangjiagang 4,700, up 20; Guangzhou 4,630, unchanged; and Xiamen not offered).
Imported rapeseed oil: The price for imported rapeseed oil steps down today, of which it is 6420-6580 yuan/tonne in coastal areas, down by 10-30 yuan/tonne. (Fujian and Guangdong not offered, and Guangxi 6,500, stable). Operation rate will pick up in rapeseed oil mills with the customs clearance of rapeseed for Fuzhiyuan, Shenheng and Great Ocean. In addition, Chinese importers have bought 32,000 tonnes of crude rapeseed oil for its improved margins recently, which has cracked down rapeseed oil futures on the Zhengzhou Commodity Exchange. But the market is shored up by the arbitrage of buying oils and selling meals among traders as hog breeding is hit hard by the African swine fever. As the inventory has continued falling upon ongoing stockpiling before festival, rapeseed oil market will have little space for callbacks and will consolidate to fluctuate. Buyers can just wait on the sidelines for new guidance.
Cottonseed oil: Today soybean oil spots go up 10-30 yuan/tonne. And cottonseed oil prices are a little bit high due to oil mills' mindset to hold onto goods, especially for oil mills in Xinjiang province who stop trading in consideration of low prices, as the stockpiling ahead of the 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 no obvious trading volume of cottonseed oil when buyers maintain cautious about market involvement. So cottonseed oil may go strong ahead of the holiday.
(USD $1=CNY 6.77)
