Today (Jan. 31st), 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 3,980 yuan/tonne, and non-GM Russian soybean is at 3,200 yuan/tonne and the GM is not offered. US soybean is buoyed to rise upon positive signs in improving China-US trade relations amid smooth trade talks between the two countries. However, global soybean supply is still ample at present. And domestic soybean market will be still damped by light trading on the distribution market as distributors gradually retreat from the market with the Spring Festival approaching. Overall, imported soybean price will likely stay stable with slight declines in distribution market recently.
Cottonseed: The cottonseed market holds steady due to the cautious purchase of oil mills for stockpiling under the conditions of the serious cottonseed crush losses as well as the decreased demand factored in the machine halt in more and more oil mills for the upcoming Spring holiday. However, China's cottonseed market is supported by the low trading of cotton ginning plants in view of less and less cottonseed supply and the prices which is at the low level of recent years. Cottonseed prices in the short run are likely to fluctuate in narrow range. Buyer should pay attention to the trade talks between China and US.
Oils:
Summary: US soybean edged up last night upon optimistic expectations for high-level trade talks between China and the United States, but oil futures post moderate falls on the Dalian Commodity Exchange today. On the spot market, soybean oil and palm oil oil are mostly not offered for strong atmosphere of the Spring Festival and some are offered lower by 10-30 yuan/tonne, and few deals have been stricken as downstream buyers have almost finished their stockpiles. Currently, the market has cast their attention on US-China talks, and China is said to purchase another 5.0 Mln tonnes of soybean after this round of talks, which has sent US soybean futures to stay near 920 cents. But meal price has turned weak upon slumps in live hog number amid the ASF, and soybean oil inventories have dropped drastically to around 1.32 Mln tonnes amid stockpiles for the festival; thus, oil futures have been propped up by the arbitrage of buying oils and selling meals among traders. In addition, soybean supply may get tight toward the end of first quarter. With oil mills supporting the price, oil market will find little room to fall and will probably fluctuate in a narrow range. Participants can await guidance from trade talks, and buyers can just wait on the sidelines.
As factories have almost closed for the imminent Spring Festival, soybean oil and palm oil are not offered today.
Imported rapeseed oil: The price for imported rapeseed oil steadily inches lower, of which it is 6,510-6,670 yuan/tonne in coastal areas, down by 10-20 yuan/tonne. (Fujian and Guangdong not offered, and Guangxi 6,580, stable). Inventories of soybean oil and rapeseed oil have both declined for stockpiles before the festival, and traders are active in the arbitrage of buying oils and selling meals as the market is bearish toward later meal price. Moreover, soybean and rapeseed supply may get tight, for oil mills have bought very few rapeseed cargoes for shipment after March amid tensions between China and Canada and first-quarter soybean arrivals have decreased by nearly 20% against one year ago. Generally speaking, rapeseed oil market may remain resilient and have few callbacks, and the overall market will consolidate in fluctuation. Buyers can just wait for guidance from China-US trade talks.
Cottonseed oil: Cottonseed oil prices are a little bit high due to oil mills' mindset to hold onto goods as prices of cottonseed oil hit a low of recent years with limited output, especially for most oil mills in Xinjiang province who stop trading in consideration of low prices. However, oils on DCE today further fall back, and most soybean oil spots are unquoted. China's oils market is negative amid the upcoming higher-level US-China negotiation. Moreover, with small volume of cottonseed oil's new order and the ending of stockpiling ahead of the holiday, its market is curbed. All in all, cottonseed oil may go strong ahead of the holiday.
(USD $1=CNY 6.70)
