Today (May. 14th), 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 old soybean is unchanged at 4,150 yuan/tonne from yesterday, and non-GM Russian soybean is unchanged at 3,400 yuan/tonne from yesterday and the GM is not offered. The imported and distributed soybean market in China are favourable on traders' mindset for high offers as the decreasing supply in Tianjin port and good demand. And China said late on Monday that it will increase tariffs on the bulk of $60 billion of US imports starting June 1, while US President Donald Trump had also ordered the start of a process to impose new duties on another $300 billion worth of Chinese items with public hearing on June 17. An increasing concerns over U.S.-China trade war are likely to affect US soybean imports later. However, the bumper crop harvest in South America and huge global supply still still curbs China's imported and distributed soybean market. Short-term prices likely maintain stable with strong momentum.
Cottonseed: Cottonseed prices today are stable with the decreasing cottonseed quantity putting pressure on market supply and the optimistic outlook supporting traders' selling-loath mood. However, the upward potential is likely curbed by low purchase activity of oil mills due to the high price of cottonseed and poor crush margin, some mills mainly using its own stock. Short-term cottonseed is likely to go strong. Buyers can make proper replenishment upon low prices, yet don't chase high bids too far.
Oils:
Summary: Beijing announced yesterday it would impose higher tariffs on the second tranche of U.S. goods valued at $60 billion from June 1, among which soybean oil would face an additional tariff of 25%, but soybean is on the list of the first tranche so that its additional tariff remains at 25%. On Monday, the Office of USTR said it planned to hold a public hearing on June 17th on the possibility of imposing duties on a further $300 billion worth of imports from China. U.S. soybean pointed to another loss last night for this, but oil futures rebound on the Dalian Commodity Exchange today upon this bullish report and sharp devaluation of the RMB. In spot markets, soybean oil goes up 20-40 yuan/tonne and palm oil up 10 yuan/tonne, both attracting larger purchases at low prices. However, oil futures on the DCE narrow down their gains in noon trading. And inventories of soybean oil and palm oil keep growing, especially soybean oil as oil mills will raise soybean crush up to a high level of 1.80-1.90 mln tonnes in the next two weeks lured by profitable South American crops. Besides, President Donald Trump said that he would meet President Xi Jinping at the G20 held in Japan in late June, for which he said “I have a feeling it’s going to be very successful”. Buyers are suggested to make appropriate replenishment instead of chase after excessive hikes on account of uncertainties in trade frictions.
Soybean oil: GB Grade I soybean oil is mainly priced at 5,240-5,330 yuan/tonne in domestic coastal areas, up by 20-40 yuan/tonne. (Tianjin 5,240-5,250, Rizhao 5,300, Zhangjiagang 5,330 and Guangdong 5,300).
Palm oil: 24-degree palm oil is mainly priced at 4,250-4,330 yuan/tonne in coastal areas, up 10 yuan/tonne. (Tianjin 4,310-4,320, up 10; Rizhao 4,330, up 10; Zhangjiagang 4,270, up 10; Guangzhou 4,250; and Xiamen not offered).
Imported rapeseed oil: Imported rapeseed oil goes up today, of which it is 7,070-7,300 yuan/tonne in coastal areas, up by 60-100 yuan/tonne. (Fujian and Guangdong not offered, and Guangxi 7,300, up 100). U.S soybean thus continued to fall on worries over intensifying trade disputes, but rapeseed oil futures post consecutive gains on the Zhengzhou Commodity Exchange today. China and Canada may stay in a stalemate before September, so that oil mills are propping up prices in view of the blocked rapeseed oil and rapeseed imports. But rapeseed oil market takes on a dim look in trading due to its enlarging price spread with soybean oil and palm oil. And mills have picked up their utilization rate while scooping up on profitable South American soybeans. Besides, both two leaders of China and the United States may manage to resolve trade disputes at a G20 summit in Japan in late June. Overall, short-term rapeseed oil may stay at high prices, but buyers had better not be lured by excessive hikes on account of uncertainties in policies.
Cottonseed oil: Cottonseed oil today stays stable with a rise of 100 yuan/tonne for some prices
when poor crush margins result in low operation rates and output and a strong cottonseed price provides support for the cost of cottonseed oil. Additionally, China said late on Monday that it will increase tariffs on the bulk of $60 billion of US imports. The additional tariff on US soybean oil is 25%. And on Monday US President Donald Trump had also ordered the start of a process to impose new duties on another $300 billion worth of Chinese items with public hearing on June 17. Amid an increasing concerns over U.S.-China trade war, today oils on DCE rebound, soybean oil spots rise 20-40 yuan/tonne, which is good for oils market. However, the cottonseed oil market is curbed by the limited cottonseed oil volume for blending, thin turnover of new orders, and high fundamental pressure in oils market. Short-term cottonseed oil is likely to stay stable with strong fluctuations and buyers are suggested to take a hand-to-mouth buying strategy.
(USD $1=CNY 6.87)
