Today (Mar. 27th), the market for meals in China is shown as follows:
Soybean meal: Meal futures edge lower on the Dalian Commodity Exchange today on the back of US soybean in overnight session, and soybean meal spots steadily slip 10-20 yuan/tonne in light trading. Specifically, the price stays at 2,520-2,570 yuan/tonne in coastal areas. (Tianjin 2,520, Shandong 2,520-2,560, Jiangsu 2,520-2,540, Dongguan 2,520-2,550, and Guangxi 2,530-2,570). Brazilian soybean crop is more than half harvested and hitting the market in batches, seeing a higher-than-expected purchase of 19 cargoes by Chinese oil mills last week. Domestic arrival will be vast later, with its total volume over 27 Mln tonnes from April to June. Meanwhile, feed enterprises take on a wait-and-see attitude after a wave of replenishment, sending trading volume of soybean meal to decline for the last two days. And this will probably turn into a hindrance for soybean meal price. However, soybean meal has accounted for a larger part in feed due to its narrowing spread with alternative meals, which has certainly compensated for reduced demand under the ASF. And oil mills are propping up prices in view of tight supply in Northern areas, Shandong and Guangdong. Therefore, short-term soybean meal market will probably show resilience and perhaps fluctuate at a narrow range, but middle-to-long term outlook is still gloomy amid the spread of the ASF and large amount but low prices of imported soybean.
Imported rapeseed meal: Imported rapeseed meal rises today, of which it settles up 10-30 yuan/tonne at 2,140-2,230 yuan/tonne in coastal areas. (Guangxi 2,140, stable; Guangdong 2,160, up 10; and Fujian 2,230, up 30). US soybean fell last night, but rapeseed meal futures post gains on the Zhengzhou Commodity Exchange today as rapeseed supply will get tightened later if tensions cannot be resolved between China and Canada, especially after China’s General Administration of Customs confirmed yesterday that another Canadian firm for canola export registration had been canceled. Currently, only two cargoes of rapeseed is reported to arrive in April and none after May. Rapeseed meal market attracts almost no deals recently due to its sharply narrowed spread with soybean meal, for which feed factories have begun to adjust their formula by adding more soybean meal. There will be probably no signs for a thaw between these two countries before the extradition hearing against Meng Wanzhou on May 8. Therefore, rapeseed oil is expected to show resilience to fall in the short run, but its upside impetus is capped by soybean meal prices which remain low amid large arrivals of soybean in the second quarter and the impact of the ASF. Later market will be guided by relations between Beijing and Ottawa, and it will fall back rapidly once tensions ease, so buyers can just wait or buy on demand.
Imported fishmeal: Today, imported fishmeal stays stable with slight rises and can be traded with price negotiations, with normal shipment at port. Quotation at ports: it is priced higher by 100 yuan at 9,900-10,000 yuan/tonne for Peruvian ordinary SD with 65% protein content, steadily at 10,200 yuan/tonne for Thai SD with 67% protein content, higher by 100 yuan at 10,600 yuan/tonne for Japanese SD with 67% protein content, and higher by 100-200 yuan at 11,000 yuan/tonne for super steam fishmeal with 68% protein content. Stocks at port: Huangpu 74,000 tonnes, Fuzhou 32,000 tonnes, Shanghai 62,000 tonnes, Tianjin 1,000 tonnes, Dalian 13,000 tonnes, Fangchenggang 1,000 tonnes and 4,000 tonnes at other ports. Spot price (FOB) in foreign market rises today: it goes up by 60 USD/tonne to 1,290USD/tonne for Peruvian ordinary SD fishmeal with 65% protein content and up by 30 USD/tonne to 1,560 USD/tonne for super SD fishmeal with 68% protein content. Chilean ordinary fishmeal with 65% protein content is quoted steadily at 1,410 USD/tonne, and prime with 68% protein content at 1,550 USD/tonne. Holders are encouraged to raise the price by price hikes abroad and price inversions at home and abroad, which also gives some supports to domestic market. But domestic aquaculture is yet to recover due to cool temperatures, in addition to the impact of the ASF, so fishmeal consumption is slpw on the whole. Moreover, its inventory will stay stubbornly high at port with new goods from Peru. Overall, domestic fishmeal market is predicted to stay stable to consolidate in the short run.
Cottonseed meal: Cottonseed meal prices today are mostly stable with some prices down 20-40 yuan/tonne. The number of live hogs in breeding has fallen dramatically with the spread of African swine fever. As the price spread between soybean meal and cottonseed meal is narrowed, the substitution of soybean meal from cottonseed meal increases in feed factory. Moreover, today meals on DCE decline slightly and soybean meal spots are stable with a decline of 10-20 yuan/tonne. All these are negative to cottonseed meal. Nevertheless, the price decline is curbed by the low operation rates in cottonseed oil mills. Given the poor demand, short-term prices are likely to maintain the weak trend. Buyers could take a hand-to-mouth buying strategy.
(USD $1=CNY 6.72)
