Today (Apr. 28th), 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 4,050 yuan/tonne from yesterday, and non-GM Russian soybean is unchanged at 3,380 yuan/tonne from yesterday and the GM is not offered. Argentina's soybeans are about 50.7% harvested, and according to investigation, Brazilian soybean crop in 2018/19 is estimated to be 115.46 million tonnes, the second-highest level. With the bumper crop harvest and quick marketing pace in South America, the global soybean supply is ample. Additionally, 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. The fluctuation of short-term prices are likely curbed.
Cottonseed: Cottonseed prices today are stable when the cotton ginning mills are waiting for higher offers as the insufficient and tight supply for cottonseed. However, the oil mills' cautiousness about purchase limits the uptrend as a tense situation during the inspection for environmental protection and poor crush margin result in low operation rates. Given the uncertainty in the market, short-term cottonseed is likely to move sideways and buyers could buy on a hand-to-mouth basis.
Oils:
Summary: U.S. soybean fell on large global supply and ongoing African swine fever in China, and oil futures are not available on the Dalian Commodity Exchange for Sunday today. In the physicals, prices are broadly stable with some rises of 10 yuan/tonne in light trading. Soybean crush has fallen to 1.66 mln tn for supply disruptions this week. But oil mills are scooping up on South American soybean for its good crush margins and selling oils and meals as a hedge on the DCE, and this is weighing down oil futures. Soybean crush may jump to near 1.80 mln tn next week as soybean import may total 25 mln ton from May to July, so soybean oil inventory will be seen higher. And the import volume of palm oil is also large in recent two month. Moreover, two cargoes of Canadian rapeseed oil at Taizhou and Zhangjiagang ports are allowed to go processed now, and followup cargoes can be unload immediately after passing sampling inspections. In the short term, oil market may extend its weak trend, and buyers can buy on demand while waiting for trade talks.
Soybean oil: GB Grade I soybean oil is mainly priced at 5,210-5,330 yuan/tonne in domestic coastal areas, a partial rise of 10 yua/tonne. (Tianjin 5,210-5,220, Rizhao 5,270, and Zhangjiagang not offered).
Palm oil: 24-degree palm oil is mainly priced at 4,380-4,390 yuan/tonne in coastal areas. (Tianjin 4,380-4,390, unchanged; Rizhao 4,380, unchanged; Zhangjiagang, Guangzhou and Xiamen not offered).
Imported rapeseed oil: Imported rapeseed oil is basically stable today, of which it is 6850-7050 yuan/tonne in coastal areas. While rapeseed oil inventory has declined by 2.2% to 409,000 tonnes in coastal areas last week, rapeseed supply may get tightened as its cargoes have all been canceled after May amid rocky relationship between Beijing and Ottawa; hence, rapeseed oil price will stay at high levels in the short term. But the market have taken on a waning look as its demand has been cut by its large spread against palm oil and soybean oil. Add to that, oil mills will crush more soybean due to ballooning imports in the second quarter from South American for its handsome crush margins. Overall, rapeseed oil market will largely depend on the relationship between China and Canada, for which it may take plunge upon a thaw. Buyers can just wait on the sidelines.
Cottonseed oil: Cottonseed oil today stays stable when the inspection for environmental protection in Shandong and poor crush margin result in low operation rates and limited output; and today oils on DCE were closed, oils spots are stable with a rise of 10 yuan/tonne. However, the upward potential of cottonseed oil is curbed when cottonseed oil volume for blending is not much. Short-term cottonseed oil is likely to stay stable with fluctuations at a narrow range, and buyers are suggested to take a hand-to-mouth buying strategy.
(USD $1=CNY 6.73)
