Today (Mar. 13th), 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 3,970 yuan/tonne, and non-GM Russian soybean is 3,190 yuan/tonne and the GM not offered. Brazilian crop harvests are being carried out at a quick pace, and Chinese importers have purchased a substantial amount of US soybean in the last few days; thus, domestic supply will probably get increased later. However, domestic soybean market remains negative due to tepid trading in its distribution market. And market participants are looking forward to more specific points from ongoing trade talks between Beijing and Washington. Therefore, short-term soybean prices will be little changed in distribution market.
Cottonseed: Cottonseed prices today holds stable after earlier decline. The cottonseed market is supported by the cotton ginning mills' mindset to hold onto goods for higher prices amid low operation rates in cotton ginning mills and cottonseed shortage. However, the cottonseed trade is weak and cautious for cottonseed crush suffers losses and the stocks in some cottonseed oil mills are still enough. So short-term cottonseed is likely to fluctuate and buyers are suggested to take a hand-to-mouth buying strategy.
Oils:
Summary: US soybean rebounded overnight upon bargain hunting, but soybean oil and palm oil fluctuate to fall on the Dalian Commodity Exchange today due to the losing streak of rapeseed oil futures in recent two days as hype on tensions between China and Canada began to fade. In the physicals, soybean oil and palm oil follow to decline by 10-40 yuan/tonne steadily. Oil supply has gradually been weighed down amid slack demand for several factors. First, world palm oil inventory goes higher-than-expected, and domestic buyers have signed more contracts for palm oil for its improving import margins. Second, domestic importers have been lingering on European Union markets for non-GM rapeseed oil due to its handsome profits. Third, soybean oil stocks have piled up by 1.5% weekly to 1.36 Mln tonnes. Therefore, oil market will have little upward impetus. Participants can pay close attention to final approvals for GMO certificates on around March 20, when the market is expected for a batch of certificates. This will play a key factor to the trend of rapeseed and its by-products. Generally speaking, short-term oil spots will continue to go after its futures to post frequent fluctuations with small ups and downs, and buyers can maintain light stockpiles for the moment.
Soybean oil: GB Grade I soybean oil is mainly priced at 5,600-5,730 yuan/tonne in domestic coastal areas, some down by 10-40 yuan/tonne. (Tianjin 5,660-5,670, Rizhao 5,660, Zhangjiagang 5,730, and Guangzhou 5,600).
Palm oil: 24-degree palm oil is mainly priced at 4,460-4,580 yuan/tonne in coastal areas, some down by 10-20 yuan/tonne. (Tianjin 4,570-4,580, down 10; Rizhao 4,570 Zhangjiagang 4,540; Guangzhou 4,460-4,470, down 20; and Xiamen not offered).
Imported rapeseed oil: Prices for imported rapeseed oil fall today, of which it is 6,860-6,970 yuan/tonne in coastal areas, down by 100-120 yuan/tonne. (Fujian and Guangdong not offered; and Guangxi 6,860, down 120). Chinese buyers have purchased a total of 80,000 tonnes of non-GM rapeseed oil from the European Union for its good profits, whilst soybean oil inventory also keeps growing; thus, domestic oil supply remains liberal at present. Beyond this, demand for rapeseed oil is now severely curbed by its enlarged spread with soybean oil and palm oil. And there may be a thaw between Beijing and Ottawa since the former will probably reach a trade deal with Washington. Besides, China’s Ministry of Agriculture and Rural Affairs is expected to issue a batch of certificates after final approvals for GMO products. Overall, short-term rapeseed oil will continue to correct its earlier solid rises, and buyers can stay on the sidelines briefly.
Cottonseed oil: Cottonseed oil today stays stable with a decline of 20-100 yuan/tonne when the cottonseed oil volume for blending is not much; soybean oil and palm oil on DCE today fall back with fluctuations due to the thin oils market and the reduction of rapeseed products speculation for the China-Canada tension. However, the decline currently will be curbed by the low operation rates and output in cottonseed oil mills. Short-term prices are likely to move sideways with downward tendency and buyers can maintain wait-and-see attitudes.
(USD $1=CNY 6.71)
