Today (Mar. 15th), the market for oilseeds and oils in China is shown as follows:
Oilseeds:
Imported soybean: Imported soybean price stays stable with declines today, among which non-GM Canadian soybean is not offered for out of stock and the GM old soybean goes down by 10 yuan to 3,960 yuan/tonne, and non-GM Russian soybean is 3,190 yuan/tonne and the GM not offered. Brazilian farmers have harvested around 57% of their crops, whilst global soybean supply remains adequate; thus, domestic supply will likely get increased later. But domestic distribution market for imported soybean is tepid currently, and US-China trade war remains as uncertainty since the two presidents’ meeting has been delayed at least until April, so traders tend to stay on the sidelines. Overall, imported soybean prices in distribution market will keep steady to fluctuate at a narrow range in the near term.
Cottonseed: Today cottonseed prices are stable. 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 thin 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 move sideways and buyers are suggested to take a hand-to-mouth buying strategy.
Oils:
Summary: A meeting between the US and Chinese Presidents was more likely to take place in April at the earliest, so US soybean closed lower overnight and oil futures also extend losses on the Dalian Commodity Exchange (DCE) today. In the spots markets, soybean oil and palm oil both slip by 30-80 yuan/tonne in delicate trading. The seesaw effect of oils and meals has weighed down on oils since meal futures have posted consecutive rebounds on the DCE after traders took the arbitrage of buying meals and selling oils amid strong trading of soybean meal. Chinese buyers have imported at least 15 cargoes of Brazilian soybeans for its good crush profit, in addition to continuous purchase of oils. And import cost will be cut down as the VAT will fall by 1%. Against slack demand, soybean oil inventory has increased to 1.36 Mln tonnes, shaking oil mills’ confidence in propping up prices. Therefore, soybean oil market will follow its futures to fluctuate to fall in the short term, but overall oil markets will have little room to decline due to uncertainties in US-China trade talks and US-Canada relations, as well as the ASF. Buyers can just wait for steady falls to replenish properly on the dips.
Soybean oil: GB Grade I soybean oil is mainly priced at 5,430-5,600 yuan/tonne in domestic coastal areas, down by 50-80 yuan/tonne. (Tianjin 5,500-5,510, Rizhao 5,500, Zhangjiagang 5,600, and Guangzhou 5,530-5,440).
Palm oil: 24-degree palm oil is mainly priced at 4,330-4,480 yuan/tonne in coastal areas, down by 30-80 yuan/tonne. (Tianjin 4470-4480, down 30; Rizhao 4,440, down 80; Zhangjiagang 4,400, down 70; Guangzhou 4,330-4,340, down 30; and Xiamen not offered).
Imported rapeseed oil: Prices for imported rapeseed oil inch lower today, of which it is 6720-6810 yuan/tonne in coastal areas, down by 20-30 yuan/tonne. (Fujian and Guangdong not offered; Guangxi 6,720, down 10). Soybean oil and rapeseed oil inventories keep growing amid slack demand. And rapeseed oil market is quiet recently due to its spread with soybean oil and palm oil. In the short term, rapeseed oil will stay in the correction territory for its excessive rises before, will gradually slow down its downward pace, so buyers can just wait on the sidelines.
Cottonseed oil: Cottonseed oil today stays stable with a rise of 100 yuan/tonne for some prices. The low operation rates and output in cottonseed oil mills are supportive of prices. However, the market is dragged down by the limited demand for cottonseed oil blends, the delay of U.S.-China summit meeting to at least April, the consecutive low closing price of U.S. soybeans overnight, further decline of oils on DCE today and a drop of 30-80 yuan for soybean oil and palm oil spots. Short-term prices are likely to hold the weak trend and buyers are suggested to take a hand-to-mouth buying strategy.
(USD $1=CNY 6.72)
