Today (Feb. 15th), 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. The market is awaiting the guidance from trade talks between China and US, for China may import more US soybeans later if the two countries manage to hammer out a deal. And domestic market will fall bearish once soybean supply multiplies. Meanwhile, domestic distribution soybean market is in tepid trading amid ongoing atmosphere of the Spring Festival, which is also unfavorable to the overall imported soybean market. Generally speaking, as the market tend to wait on the sidelines, imported soybean price will likely stay stable with narrow adjustments in distribution market recently.
Cottonseed: The purchase of cottonseed is not much now due to the following conditions: the crush in oil mills still shows loss; the transportation hasn't resumed for the holiday; the trade activities are weak; some cottonseed oil mills has make the stockpiling before holiday. However, for the cotton ginning mills are inclined to hoard their existing stocks of cottonseed due to the low price level and short supply, the cottonseed in the short run is likely to stay stable with move in narrow range. Buyers are suggested to take a hand-to-mouth buying strategy and pay attention to the trade talks, which may have a negative influence if the agreements are reached.
Oils:
Summary: Soybean futures broadly traded lower last night upon disappointing export data, for China had canceled a 1.25-million-tonne of US soybean bookings in January. Today, oils fluctuate to adjust on the Dalian Commodity Exchange, and spot prices of soybean oil and palm oil both stay stable with some declines in weak trading. Domestic oils have been weak in recent two days as the market is looking to a trade deal from ongoing US-China talks. Oil mills now rely largely on their inventories after sharp drops in operation rate during the Spring Festival, and they are also propping up prices for possible soybean supply tensions in the first quarter and current low meal prices. On the whole, short-term oil market will maintain range bound, and buyers can just wait on the sidelines while waiting for guidance from trade talks, whose outcome may bring some bearish influence to domestic market.
Soybean oil: GB Grade I soybean oil is priced at 5,650-5,750 yuan/tonne in domestic coastal areas, down by 10-20 yuan/tonne. (Tianjin 5,690-5,700, Rizhao 5,700, Zhangjiagang 5,750, and Guangzhou 5,650-5,660).
Palm oil: 24-degree palm oil is mainly priced at 4,660-,4780 yuan/tonne in coastal areas, down by 10 yuan/tonne partially. (Tianjin 4,770-4,780; Rizhao 4,770, unchanged; Zhangjiagang 4,720, down 10; Guangzhou 4,660-4,670, down 10; and Xiamen not offered).
Imported rapeseed oil: The price for imported rapeseed oil goes down today, of which it is 6,460-6,620 yuan/tonne in coastal areas. (Fujian and Guangdong not offered, and Guangxi 6,490, stable). Importers now find it hard to get the approval and issuance of certificate for Canadian rapeseed and GMO crude rapeseed oil amid rocky relations between China and Canada, and such uncertainties will also result in fewer cargo purchases for later rapeseed and crude rapeseed oil. In addition, soybean and rapeseed supply may get tight at the end of this quarter, and meal prices remain low as hog feeding is hit hard by the African swine fever; thus, oil mills tend to support prices at present. Overall, rapeseed oil market will be resilient and consolidate in fluctuation. Participants can pay attention to trade talks today, and buyers can just wait on the sidelines.
Cottonseed oil: Cottonseed oil today mostly stays stable with fluctuation in the range of 30-50 yuan/tonne for some prices. And some prices in Xinjiang continue to rise amid oil mills' mindset to hold onto goods for higher prices due to the low cottonseed oil output and the low prices level among recent years, as well as the low operation rate. However, some prices inland see a slight drop today, and prices in the shorter term are expected to have limited upward potential and likely to stay stable with strong fluctuation because due to the bad performance of US export data, US soybeans overnight show a big decline, and oils on DCE today fall with fluctuations, and most soybean oil prices decline by 10-20 yuan/tonne; additionally, buyers mostly take wait-and-see attitude for the optimistic expectation that US-China agreements will be reached.
(USD $1=CNY 6.77)
