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Daily Review on Meal Market in China

2019-05-05 www.cofeed.com
      Today (May. 5th), the market for meals in China is shown as follows:
 
      Soybean meal: Main U.S. soybean contracts ended down 22 cents over the May Day holiday, and meal futures are not available on Dalian Commodity Exchange on Sunday today. Spot soybean meal steadily drops 10-20 yuan/tonne against that before the holiday in weaker trading, to settle at 2,480-2,520 yuan/tonne in coastal areas. (Tianjin 2,510, Shandong 2,490-2,530, Jiangsu 2,480-2,500, Dongguan 2,480-2,500, and Guangxi 2,490-2,520). Oil mills have almost stopped their quotations today, and distributors offer lower by 10-20 yuan in light trade. Soybean supply is plenty as there is a total of around 25 mln tn from South America from May to July. Moreover, a decrease may occur in sow and piglet breeding because it will be more difficult to control the African swine fever entering summer. And downstream buyers are still digesting their stockpiles after a wave of replenishment previously. Therefore, meal prices are curbed. But due to consecutive losses of U.S. soybean over the vacation, meal futures may point to some declines when the Dalian Commodity Exchange resumes its trading tomorrow. Short-term soybean meal will probably fall to adjustments, and buyers can wait on the sidelines. 
 
      Imported rapeseed meal: Imported rapeseed meal stays basically stable today, of which it settles at 2,090-2,190 yuan/tonne in coastal areas. (Guangxi 2090, stable; Guangdong 2,150, stable; and Fujian 2,200, stable). Rapeseed meal market is supported by potential tensions in rapeseed supply as rapeseed cargoes from Canada have all been canceled after May amid diplomatic disputes. But its demand has been crippled by its narrowed spread with soybean meal. Moreover, DDGS imports from the United States may be resumed amid smooth trade talks, and domestic soybean import is relatively huge from May to August. Therefore, rapeseed meal will probably maintain its choppy, range-bound trend in the recent sessions, and buyers can take a hand-to-mouth basis.
 
      Imported fishmeal: Imported fishmeal prices stay stable amid tepid 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 and 10,500 yuan/tonne for Thai SD with 67% protein content, 10,900-11,100 yuan/tonne for Japanese SD with 67% protein content and 11,200-11,500 yuan/tonne for super steam fishmeal with 68% protein content. Stocks at port: Huangpu 90,000 tonnes, Fuzhou 24,000 tonnes, Shanghai 81,000 tonnes, Tianjin 1,000 tonnes, Dalian 18,000 tonnes, Fangchenggang 1,000 tonnes and 4,000 tonnes at other ports. Spot price (FOB) in foreign market keeps steady today: it is 1,410 USD/tonne for Peruvian ordinary SD fishmeal with 65% protein content and 1,660 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 higher by 90 USD/tonne at 1,640 USD/tonne. The market is a hybrid of a bull and a bear. On one hand, domestic holders have received some support from firm quotation abroad and price inversion at home and abroad; on the other, inventory pressure is intensifying amid tepid demand and new cargoes from Peru. Overall, fishmeal market will probably keep steady to consolidate in the short term.
 
      Cottonseed meal: Cottonseed meals today partially rise 20-100 yuan/tonne as the low operation rates and limited output. However, ASF drags down demand for cottonseed meal. And 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. Additionally, meals on DCE today are closed and soybean meals from distributors slightly decline 10-20 yuan/tonne. The low prices of soybean meal are likely to affect the upward potential for cottonseed meal. Buyers are suggested to take a hand-to-mouth buying strategy.
 
      (USD $1=CNY 6.74)