Today (May 17th), the market for oilseeds and oils in China is shown as follows:
Oilseeds:
Imported soybean: Imported soybean price is steady today, among which non-GM Canadian soybean is not offered for out of stock, and non-GM Russian soybean is unchanged at 3,450 yuan/tonne from yesterday, non-GM Kazakhstan soybean is unchanged at 4,230 yuan/tonne from yesterday. China's soybean market is favourable on traders' optimistic outlook. The supply in Tianjin port is small, while the demand is good. Besides, The US soybean import in the future is likely affected as China and US both increase tariffs on the goods from each other and there are still some uncertainties over trade talks. However, the bumper crop harvest in South America and huge global supply still curbs China's market. Short-term prices likely go strong.
Cottonseed: Cottonseed prices today are stable with some rises of 0.03 yuan/kg 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. While oils and meals rebound on the concerns over trade war, short-term cottonseed is likely to go strong. Buyers thereby had better make proper replenishment upon low prices rather than chase high bids too far.
Oils:
Summary: U.S. soybeans continued rises overnight on further seeding delays for this round of rains, and oil futures gradually narrow gains after higher opens on Dalian Commodity Exchange today. In spot markets, soybean oil and palm oil broadly go up 30-40 yuan/tonne, seeing brisk trading upon low basis. The long-lost strong trading of 110,000 tonnes in oil market can be contributed to low availability by downstream buyers and days of price gains in a row. Moreover, South American soybean has seen its net crush margin fall to 220-250 yuan/tonne due to growing import cost under a weaker Chinese yuan. And tensions between China and Canada still hang over the market. Oil market will thus receive some support. But soybean crush may still soar in the next two weeks, and soybean oil and palm oil have already begun piling up inventories. In the short term, oil market is expected to see little upward space and post frequent fluctuations in line with trade changes. Buyers had better not be lured by huge rises.
Soybean oil: GB Grade I soybean oil is mainly priced at 5,280-5,400 yuan/tonne in domestic coastal areas, mostly up by 10-40 yuan/tonne. (Tianjin 5,280-5,290, Rizhao 5,340, Zhangjiagang 5,400 and Guangdong 5,320).
Palm oil: 24-degree palm oil is mainly priced at 4,340-4,410 yuan/tonne in coastal areas, up 10-40 yuan/tonne. (Tianjin 4,380-4,390, up 10; Rizhao 4,410, up 10; Zhangjiagang 4,360, up 40; Guangzhou 4,340-4,350; and Xiamen not offered).
Imported rapeseed oil: Imported rapeseed oil steadily fluctuates today, of which it fluctuates by 10-20 yuan/tonne to settle at 7,090-7,200 yuan/tonne in coastal areas. (Fujian and Guangdong not offered, and Guangxi 7,200, down 100). rapeseed oil market has few buyers recently as its demand is severely influenced by its enlarging spread with soybean oil and palm oil. Moreover, mills will raise their utilization rate for soybean crush for good margins amid huge global soybean supply. Therefore, rapeseed oil market turns bearish on growing inventories of soybean oil and palm oil. But rapeseed posts a tight supply outlook with only two cargoes left in May and only one in June as its import is blocked by tensions between China and Canada. Overall, short-term rapeseed oil prices will remain high amid tensions, and will take plunge upon a thaw, so buyers can just wait on the sidelines for the moment.
Cottonseed oil: Cottonseed oil today stays stable 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, today oils on DCE continue to rise, and spots soybean oil and palm oil mostly go up 30-40 yuan/tonne. 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 fluctuate strongly and buyers are suggested to make proper replenishment upon low prices.
(USD $1=CNY 6.89)
