Today (Apr. 15th), 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 3,980 yuan/tonne from last Friday, and non-GM Russian soybean is unchanged at 3,300 yuan/tonne from last Friday and the GM is not offered. The Buenos Aires Grains Exchange on Thursday raised it forecast for Argentina's soybean harvest to 55 million tonnes, up 2 million tonnes. Brazilian agricultural statistics agency Conab, meanwhile, raised its estimates for the country's soy harvests. With the good harvesting progress in South America, the global soybean supply is ample. Besides, with clear outlook of U.S.-China trade talks, China will purchase more US soybeans. The expectation of more soybean import weighs on the imported soybeans for distribution amid its tepid demand. Short-term prices likely keep stable.
Cottonseed: Cottonseed prices today are mostly stable with some prices up 0.01-0.08 yuan/kg. The low operation rates in cotton ginning mills and insufficient cottonseed supply as well as the strong sideways for unginned cotton prices make the mills wait for higher offers. However, the cottonseed trade is still light when cottonseed oil mills with low operation rates are cautious and purchase upon demand. Short-term cottonseed is likely to stay stable with strong fluctuations and buyers could make proper replenishment upon low prices.
Oils:
Summary: US soybean closed flat last Friday, and oil futures swing to inch higher on the Dalian Commodity Exchange today. In the physicals, soybean oil steadily goes up by 10-20 yuan/tonne, and palm oil down by 10 yuan/tonne, both attracting some purchases at low prices. Short-term US soybean remains weak turbulence amid disappointing exports data and global supply gluts. Domestic soybean oil inventory has climbed higher again to 1.35 Mln tonnes in delicate demand, fueled by 1.69 Mln tonnes of soybean crush last week and possibly 1.80 Mln tonnes next week. Moreover, soybean import is ballooning in the second quarter due to good crush margins of South American crops, whose cost of arrival at ports has been lowered down by declining premiums. Oil market continues to be weighed on by above fundamentals. However, meal prices have been dragging down by the ASF, and rapeseed oil prices stay stubbornly as imported rapeseed shipments after May have almost been canceled due to rocky relationships between China and Canada. And soybean oil and palm oil prices have thus been bolstered. Short-term spot oil market is predicted to follow futures to fluctuate frequently and narrowly, and buyers can keep appropriate stockpiles on the dips instead of chasing after excessive rises. According to foreign media, U.S. will water down demand for China to reduce subsidies in push for a trade deal, and its Treasury Secretary indicated that the two sides are edging closer to an accord. If so, domestic oil market will react negatively.
Soybean oil: GB Grade I soybean oil is mainly priced at 5,380-5,540 yuan/tonne in domestic coastal areas, up by 10-20 yuan/tonne partially. (Tianjin 5,380-5,390, Rizhao 5,450, Zhangjiagang 5,540, and Guangzhou 5,380-5,390).
Palm oil: 24-degree palm oil is mainly priced at 4,450-4,520 yuan/tonne in coastal areas, down by 10 yuan/tonne partially. (Tianjin 4,510-4,520, down 10; Zhangjiagang 4,470; Guangzhou 4,450, down 10; and Xiamen not offered).
Imported rapeseed oil: Imported rapeseed oil edges higher today, of which it goes up partially by 20-30 yuan to settle at 6,920-7,050 yuan/tonne in coastal areas. (Fujian and Guangdong not offered; and Guangxi 7,050). Rapeseed oil inventory has fallen to 429,000 tonnes in coastal areas last week, and imported rapeseed shipments after May have almost canceled due to tensions between Beijing and Ottawas; thus, short-term rapeseed oil still keeps firm. But the market has taken on a frosty picture as its demand has been severely cut by its dramatically enlarged spread with soybean oil and palm oil. Moreover, operation rate for soybean crush has picked up as soybean imports soar in the second quarter. So rapeseed oil market is put into a bearish stance. Later market will depend largely on a thaw between Beijing and Ottawa, before which its price will stay high and after which it will quickly take plunge. Buyers are suggested to maintain light stockpiles.
Cottonseed oil: Cottonseed oil today stays stable with a rise of 30-100 yuan/tonne when the machine halt in some mills pushes operation rate and output lower, and today oils on DCE see a small rise with fluctuations and soybean oil is stable with a rise of 10-20 yuan/tonne. However, the upward potential for short-term cottonseed oil is limited as edible oil is in periodic off-season; cottonseed oil volume for blending is not much; fundamentals of bulk oils is not good. But the market is expected to rise slowly later. Buyers are suggested to take a hand-to-mouth buying strategy.
(USD $1=CNY 6.71)
