Today (Apr. 16th), 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 yesterday, and non-GM Russian soybean is unchanged at 3,300 yuan/tonne from yesterday and the GM is not offered. Conab’s latest Brazilian bean estimate for 2018/19 was 113.8 million tonnes, up 0.3 million tonnes. And Agrural raised their Brazilian production to 114.6 million tonnes, up 1.5% from previous forecast. With the bumper crop harvest expectation in South America, the global soybean supply is ample. Besides, with U.S.-China trade talks going well and agreement nearing completion, 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 fluctuations of 0.04-0.06 yuan/kg. The low operation rates in cotton ginning mills and insufficient cottonseed supply, especially for some regions, as well as the strong sideways for unginned cotton prices make the cotton ginning 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 inched higher on Monday, but oil futures fluctuate to fall on the Dalian Commodity Exchange today, as the market is worried that China may ease its import restrictions after one rapeseed oil cargo is allowed to be unloaded and the other can be sampled at port in East China, and domestic soybean oil inventory has reached 1.35 Mln tonne fueled by 1.69 Mln tonnes of soybean crush last week and possibly 1.80 Mln tonnes next week. Spot soybean oil and palm oil follow to slip 20-40 in delicate trade. Imported soybean quantity will grow massively in the second quarter due to good crush margins of South American soybean, whose declining premiums have brought down import costs. And palm oil will see its production grow in Malaysia, with an increment of 5% month-on-month in the first half of April. But meal prices still cripple under the ASF, and there is no sign of a thaw between Beijing and Ottawa; thus, oil market will have little downside potential. Short-term market is forecast to extend its frequent fluctuations to adjust on the back of futures, and buyers can just keep light stockpiles.
Soybean oil: GB Grade I soybean oil is mainly priced at 5,340-5,480 yuan/tonne in domestic coastal areas, down by 20-40 yuan/tonne partially. (Tianjin 5,350-5,360, Rizhao 5,410, Zhangjiagang 5,480, and Guangzhou 5,340).
Palm oil: 24-degree palm oil is mainly priced at 4,420-4,520 yuan/tonne in coastal areas, down by 20-30 yuan/tonne. (Tianjin 4,480, down 30; Zhangjiagang 4,430, down 20; Guangzhou 4,420, down 20; and Xiamen not offered).
Imported rapeseed oil: Imported rapeseed oil falls today, of which it goes down by 30-50 yuan to settle at 6,880-7,050 yuan/tonne in coastal areas. (Fujian and Guangdong not offered; and Guangxi 7,050). Of the two rapeseed oil ships moored at coastal ports in East China, one is unloading and the other is taken sampling now, which has triggered some concerns among the market. And rapeseed oil market has taken on a frosty picture as its demand has been severely cut by its fresh large price spread with soybean oil and palm oil. But rapeseed shipments after May have almost been canceled due to rocky relationships between China and Canada, so short-term rapeseed oil will not slump. Later trend will mainly depend on state policies, which have given strong support to current high prices, and the trend will then fall steeply on a thaw. Buyers had better keep light stockpiles at present.
Cottonseed oil: Cottonseed oil today stays stable with some declines of 150 yuan/tonne when edible oil is in periodic off-season; cottonseed oil volume for blending is not much; today oils on DCE fall back with fluctuations and soybean oil and palm oil spots drop 20-40 yuan/tonne. However, the market is bolstered by the machine halt in some mills as well as the low operation rates and output accordingly. But due to the poor fundamentals of bulk oils, short-term cottonseed oil is likely move sideways, and yet the market is expected to slowly rise with fluctuations later. Buyers are suggested to take a hand-to-mouth buying strategy.
(USD $1=CNY 6.71)
