Today (May. 15th), the market for meals in China is shown as follows:
Soybean meal: U.S. President Donald Trump described the dialogue with China as “very good” and tweeted earlier that the United States would make a deal with China when the “time is right”, and Secretary of Treasure, Steven Mnuchin would likely visit Beijing very soon for more trade talks. Meanwhile, Trump announced that he would meet Chinese President Xi Jinping at a G20 summit in Japan late next month, where they might manage to resolve differences. U.S. soybean rallied over 4% in overnight trading contributed to short covering by investors as trade fears eased, and meal futures expand gains after higher opens on the Dalian Commodity Exchange today. Spot soybean meal goes up 10-30 yuan/tonne with some purchases at low prices. Specifically, the price settles at 2,660-2,710 yuan/tonne in coastal areas. (Tianjin 2,710, Shandong 2,670-2,700, Jiangsu 2,660-2,700, Dongguan 2,660-2,690, and Guangxi 2,660-2,690). Demand is increasing as aquaculture gets started, mills are pressure-free in stockpiles as soybean meal is reporting strong trading due to its minor spread with mixed meals, and import cost has been growing as the RMB depreciates significantly. These have thus made joint support to consecutive price rises of soybean meal. Hedge funds have interrupted in due to handsome crush margins of South American soybeans, and the utilization rate for soybean crush will pick up sharply in the coming two weeks. Besides, there may still be a detente in trade disputes. Buyers are suggested not to be lured by excessive hikes.
Imported rapeseed meal: Imported rapeseed meal steadily edges up today, of which it settles up 10-20 yuan at 2,220-2,300 yuan/tonne in coastal areas. (Guangxi 2,220, up 10; Guangdong 2,270, stable; and Fujian 2,300, up 10). Rapeseed has taken on a tight supply outlook as its cargoes from Canada have all been canceled amid diplomatic tensions. And demand from aquaculture is gradually increasing as the summer moves on in south China. Therefore, soybean meal and rapeseed meal have both seen declining inventories and rapeseed meal market is shored up. But its demand has been largely taken away by soybean meal due to minor spread, and mills will raise their utilization rate for soybean crush due to profitable South American crops. And meal demand may turn dim due to the difficulty in controlling the ASF in summer. So there will be limited room for rapeseed meal to continue its rises, and buyers had better not chase after excessive price hikes as there may be a detente in trade frictions.
Imported fishmeal: Imported fishmeal prices stay stable amid tepid shipments at port today. Quotation at ports: it is priced steadily at 10,400 yuan/tonne for Peruvian ordinary SD with 65% protein content, 10,700 yuan/tonne for Thai SD with 67% protein content, 11,000-11,100 yuan/tonne for Japanese SD with 67% protein content and 11,300-11,500 yuan/tonne for super steam fishmeal with 68% protein content. Stocks at port: Huangpu 95,000 tonnes, Fuzhou 24,000 tonnes, Shanghai 84,000 tonnes, Tianjin 1,000 tonnes, Dalian 19,000 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 at 1,640 USD/tonne. The market is a hybrid of a bull and a bear. On one hand, domestic quotations keep firm due to stable bidding at foreign market, the devaluation of the RMB and price inversions at home and abroad; on the other, the market is restricted by low demand and growing inventories at ports. Overall, fishmeal market will probably keep steady to consolidate in the short term.
Cottonseed meal: Today cottonseed meal stays stable when operation rates and output are low and a strong cottonseed price provides support for the cost of cottonseed meal. Additionally, Trump made positive comments on trade talks and said when the time was right US would make a deal with China. U.S. Treasury Secretary Steven Mnuchin will plan for another trade meeting in China at some point soon and Trump was planning to meet Chinese President Xi Jinping in late June at a Group of 20 leaders summit in Japan, a Treasury spokesman said on Tuesday. As trade fears ease and short covering, today meals on DCE rise with high open, and spots soybean meals go up 10-30 yuan/tonne, which is good for cottonseed meal market. However, 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. The slow trade of new orders are likely to affect the upward potential for cottonseed meal. Buyer shouldn't chase high bids too far amid the great uncertainties over trade talks.
(USD $1=CNY 6.88)
