Today (Apr. 11th), the market for meals in China is shown as follows:
Soybean meal: US soybean inched higher last night, and meal futures edge down in choppy trading on the Dalian Commodity Exchange today. Spot soybean meal steadily fluctuates 10-20 yuan in lighter trading, yet attracting some deals upon negative forward basis of 80-110 yuan/tonne. Specifically, the price settles at 2,500-2,540 yuan/tonne in coastal areas. (Tianjin 2,510, Shandong 2,500-2,520, Jiangsu 2,510-2,530, Dongguan 2,500-2,540, and Guangxi 2,510-2,540). Whilst soybean imports have grown massively in the second quarter due to good crush margins amid declining arrival cost as South American soybean continues to see lower premiums, later demand for meal products will be severely cut by the ASF. Meanwhile, U.S. Treasury Secretary Steven Mnuchin said the United States and China have agreed on an enforcement mechanism for their potential trade deal, in which China will continue its substantial imports of US agriculture products. And anti-dumping and anti-subsidy duties on US DDGS will very likely be eliminated. Meal prices have thus come under pressure. However, soybean meal has accounted for a larger part in feed due to its narrowed spread with alternative meals, with its ratio raised to 18-20% from previous 14-16% in pig feed and to 25% from 17% in poultry feedstuff. For this, soybean meal has been reporting robust trading volume, creating a record for this year of 570,000 tonnes yesterday. Soybean meal has strengthened its resilience amid eased inventory pressure. In the short term, soybean meal may extend narrow fluctuations, and buyers can consider buying on negative forward basis.
Imported rapeseed meal: Imported rapeseed meal edges up steadily today, of which it settles at 2,100-2,180 yuan/tonne in coastal areas, some up by 10 yuan/tonne. (Guangxi 2,100, stable; Guangdong 2,120, stable; and Fujian 2,180, stable). Rapeseed meal market is now shored up by potential supply tensions of rapeseed, as there are only three cargoes left in April and none after May amid rocky relationships between Beijing and Ottawa. However, rapeseed meal has been replaced to a large extent by soybean meal due to their narrowed spread, and soybean imports will grow sharply in the second quarter. Meanwhile, U.S. Treasury Secretary Steven Mnuchin said the United States and China have agreed on an enforcement mechanism for their potential trade deal, in which China will continue its substantial imports of US agriculture products. And anti-dumping and anti-subsidy duties on US DDGS will very likely be eliminated. Therefore, short-term rapeseed meal will have little room for rises, and later trend will depend largely on a thaw between China and Canada, for which the market will probably come down. Buyers can replenish on demand for the moment.
Imported fishmeal: Imported fishmeal steadies with some bargaining space at Southern ports and unhurried shipments at port today. Quotation at ports: it is priced steadily at 10,200-10,300 yuan/tonne for Peruvian ordinary SD with 65% protein content, 10,500 yuan/tonne for Thai SD with 67% protein content, 10,900-11,000 yuan/tonne for Japanese SD with 67% protein content, and 11,200-11,400 yuan/tonne for super steam fishmeal with 68% protein content. Stocks at port: Huangpu 79,000 tonnes, Fuzhou 28,000 tonnes, Shanghai 67,000 tonnes, Tianjin 1,000 tonnes, Dalian 12,000 tonnes, Fangchenggang 1,000 tonnes and 4,000 tonnes at other ports. Spot price (FOB) in foreign market remains unchanged today: it is quoted steadily at 1,440 USD/tonne for Peruvian ordinary SD fishmeal with 65% protein content and 1,690 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. Local producers in Peru offer firmly fueled by fast advance sales in new season, and there still exists price inversion at home and abroad. Therefore, domestic fishmeal market reacts positively as holders are encouraged to prop up prices. But its demand is tepid now subject to the ASF, resulting in huge inventory pressure at ports. Overall, domestic fishmeal market will stay stable to edge higher in the near term.
Cottonseed meal: Cottonseed meals today are stable with some rises of 10 yuan/tonne due to low operation rates and output. However, the soybean meal market is curbed because the number of live hogs has fallen to a low level with an epidemic of African swine fever; as the price spread between soybean meal and cottonseed meal is too narrow, the substitution of soybean meal from cottonseed meal happens in feed factory; today meals on DCE decline slightly with fluctuations, and soybean meal spots are stable with fluctuations of 10-20 yuan/tonne. Short-term prices are likely to move sideways. Buyers are suggested to take a hand-to-mouth buying strategy.
(USD $1=CNY 6.71)
