Today (Mar. 29th), the market for oilseeds and oils in China is shown as follows:
Oilseeds:
Imported soybean: Imported soybean price stays stable today, among which non-GM Canadian soybean is not offered for out of stock and the GM old soybean is unchanged at 4,030 yuan/tonne from yesterday, and non-GM Russian soybean is unchanged at 3,270 yuan/tonne from yesterday and the GM is not offered. As Brazilian soybeans harvest is 68% complete compared to 65% the same period last year and Argentina's soybean is harvesting and appearing on the market amid good yield, the global supply of soybean is ample and the supply for China's market is also likely to go up later to the detriment of imported soybean prices in distribution market amid tepid demand. Market has held a wait-and-see attitude in the period of U.S.-China trade talks and imported soybean prices in distribution market is predicted to be stable or stable with fluctuations in a small range in the short run.
Cottonseed: Today some cottonseed prices see a decline of 0.01 yuan/kg. Due to poor crush margin, low operation rates and relatively sufficient stock, cottonseed oil mills are more cautious in purchasing cottonseed amid the tepid demand of cottonseed oil and meal. However, the cottonseed decline is limited by the cotton ginning mills' mindset to hold onto goods for the low operation rates in cotton ginning mills and cottonseed shortage. Short-term cottonseed is likely to fluctuate weakly and buyers are suggested to take a hand-to-mouth buying strategy.
Oils:
Summary: U.S. soybean rose overnight as Chinese state-owned firms bought about 1.5 million tonnes of U.S. soybeans for shipment in July and August and Beijing was said to have made concessions on technology transfer to propel trade talks. In China, oil futures post consecutive losses on the Dalian Commodity Exchange today for active arbitrage of buying meals and selling oils and lower prices of crude oil futures. In the physicals, soybean oil and palm oil slip by 20-60 yuan/tonne in dismal trading. Chinese oil mills are scooping up on Brazilian soybeans, which have showed good crush margins due to sharp devaluation of Brazil real, so that soybean will arrive in large batches in the second quarter. And domestic soybean crush is forecast to go above 1.70 Mln tonnes in coming two weeks. In this case, soybean oil inventory will continue its upward trend. Meanwhile, palm oil stockpiles in February have increased by 1.3% monthly to 3.05 Mln tonnes in Malaysia, and domestic imports of palm oil in April have totaled 23 cargoes. But the questions is that end demand for oils remains weak, so that oil market has come under pressured. Overall, short-term oil market is predicted to maintain its weak trend, and buyers can take hand-to-mouth buying while awaiting progress in trade talks.
Soybean oil: GB Grade I soybean oil is mainly priced at 5,340-5,440 yuan/tonne in domestic coastal areas, down by 30-60 yuan/tonne. (Tianjin 5,360-5,370, Rizhao 5,400, Zhangjiagang 5,440, and Guangzhou 5,340).
Palm oil: 24-degree palm oil is mainly priced at 4,260-4,390 yuan/tonne in coastal areas, down by 20-50 yuan/tonne. (Tianjin 4,380-4,390, down 40; Rizhao 4,370, down 30; Zhangjiagang 4,330, down 20; Guangzhou 4,260, down 50; and Xiamen not offered).
Imported rapeseed oil: Imported rapeseed oil falls further today, of which it settles down 120-180 yuan/tonne at 6,810-6,910 yuan/tonne in coastal areas. (Fujian and Guangdong not offered; adn Guangxi 7,000, down 100). US soybean rose overnight, but rapeseed oil futures extend sharp losses on the Zhengzhou Commodity Exchange today on active arbitrage of buying meals and selling oils and the issuance of a batch of GMO rapeseed certificates yesterday, in addition that Canadian experts will visit China to discuss issues around rapeseed exports and Meng Wanzhou is expected to be released. It is now the low season for oils, whose stocks remain mammoth. Moreover, rapeseed oil market has taken on a frosty look for its markedly enlarged spread with soybean oil and palm oil. And soybean arrivals will increase substantially in the second quarter due to healthy crush margins of Brazilian soybeans. Therefore, rapeseed oil market is dragged down to adjust its previously bloated rises. But the market outlook is still uncertain as those rapeseed and rapeseed oil cargoes are still not allowed to be processed after unloaded, and China and Canada will probably maintain their status quo before extradition hearing on May 8, so buyers can just wait on the sidelines.
Cottonseed oil: Cottonseed oil today stays stable as the low operation rates and output in cottonseed oil mills. However, the market is negative as the cottonseed oil volume for blending is not much; the turnover for oils is thin; due to the crude oil decline and arbitrage of buying meals and selling oils, oils on DCE today see another decline and soybean oil and palm oil spots drop 20-60 yuan/tonne. Amid a glut of bulk oils and their slack trends, short-term cottonseed oil will keep the weak trend and buyers are suggested to maintain wait-and-see attitudes.
(USD $1=CNY 6.74)
