Today (Feb. 22nd), 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 outcome of US-China talks will likely be released today. Besides, a foreign media reported that China is expected to propose buying an additional $30 billion of U.S. agricultural imports annually, including soybean, corn and wheat. The chance for a reconciliation increases now that China and the US are are starting to sketch out an agreement. In addition, Chinese importers are now scooping up Brazilian soybean for delivery in April and May as Brazilian planters are now harvesting their crops. But the tepid trading in the distribution market is still unfavorable to overall domestic market for imported soybean. In general, imported soybean price will likely stay stable with narrow adjustments in distribution market recently.
Cottonseed: Today cottonseed prices are stable. The trading is not active for the losses of crushing, the low demand owing to the remaining stock before holiday, as well as that most oil mills haven't resumed the purchase. 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. The cottonseed in the short run is likely to maintain its weak fluctuation. Buyers are suggested to take wait-and-see attitudes.
Oils:
Summary: US soybean gained last night upon a 4.7% drop in soybean planting area to 85 Mln acres this year by USDA estimates, and oil futures reverse its declines to rise on the Dalian Commodity Exchange today. In the spots market, soybean oil and palm oil both goes up to attract some deals at low prices, but total trading volume is small as buyers remain cautious ahead of the upcoming results in trade talks. The rebound today is triggered by low meal prices under the rampant ASF and declining soybean oil stockpiles. But import costs will be lowered down by sustained appreciation of RMB. Besides, a foreign media reported that China is expected to propose buying an additional $30 billion of U.S. agricultural imports annually, including soybean, corn and wheat. The chance for a reconciliation increases now that China and the US are are starting to sketch out an agreement. If so, the market may fall bearish. Overall, short-term oil market will be in the choppy trading, and buyers can just keep a light stock.
Soybean oil: GB Grade I soybean oil is priced at 5,620-5,760 yuan/tonne in domestic coastal areas, up by 20-30 yuan/tonne. (Tianjin 5,700-5,710, Rizhao 5,720, Zhangjiagang 5,760, and Guangzhou 5,620).
Palm oil: 24-degree palm oil is mainly priced at 4,600-4,720 yuan/tonne in coastal areas, up by 10-30 yuan/tonne partially. (Tianjin 4,710-4,720, up 10; Rizhao 4,700, unchanged; Zhangjiagang 4,680, up 30; Guangzhou 4,600, up 10; and Xiamen not offered).
Imported rapeseed oil: The price for imported rapeseed oil rises today, of which it is 6,480-6,650 yuan/tonne in coastal areas, up 10-20 yuan/tonne. (Fujian not offered; Guangdong 6,460; and Guangxi 6,540, up 10). Indonesia is said to re-implement its tariff policy on palm oil which was shelved during the election, and this will be conducive to the exporting regions. Besides, mills are propping up oil prices for low meal prices since hog feeding is hit hard by the rampant ASF. Domestic rapeseed oil market is thus buoyed to rebound. But overall demand for oils has entered into off-season. In addition, a foreign media reported that China is expected to propose buying an additional $30 billion of U.S. agricultural imports annually, including soybean, corn and wheat. The chance for a reconciliation increases now that China and the US are starting to sketch out an agreement. And importers have increased their purchase for palm oil and rapeseed oil cargoes for their growing margins upon appreciation of the RMB. With the existence of the bull and the bear, rapeseed oil market will maintain its strong trend in fluctuation.
Cottonseed oil: Cottonseed oil today stays stable. US soybeans overnight went up, while oils on DCE today revise early declines to rise, and China's soybean oil and palm oil spots see a rise of 10-30 yuan/tonne. When the oils market is positive as the meal prices further go weak with the ASF spreading, cottonseed oil is supported by the low operation rates and output in the mills. But buyers maintain cautious about market involvement before the end of U.S.-China trade talks, and the turnover and the blending volume of cottonseed oil are both not much, so in the shorter term the prices still are likely to stay fluctuation. Buyers had better take a light position level for the time being.
(USD $1=CNY 6.72)
