Today (May 21st), 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' strong offers. The supply in Tianjin port is small, while the demand is good. Besides, The US soybean import is likely curbed as U.S.-China trade talks suspend. However, the bumper crop harvest in South America and huge global supply still curbs China's market. Short-term prices likely maintain stable with strong momentum.
Cottonseed: Cottonseed prices today are stable with a rise of 0.06 yuan/kg due to the decreasing cottonseed quantity putting pressure on market supply and the optimistic outlook supporting traders' selling-loath mood. Besides, the freight from Xinjiang to China's inland rises a bit. However, the cottonseed trading is not much as oil mills are reluctant to purchase and some mills mainly use its own stock due to the high price of cottonseed and poor crush margin. 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 reversed losses to rally on short coverings in overnight trading, and oil futures fluctuate to adjust on the Dalian Commodity Exchange today. In spot markets, soybean oil posts a partial loss of 10-20 yuan/tonne and palm oil sees a partial rise of 10 yuan/tonne, both in light trading. Oil futures fail to extend tentative rebound in morning trade, and soybean oil even edges down in afternoon trade. As soybean crush has increased drastically by 15% to 1.94 mln tonnes last week and will remain at such levels in following two weeks, soybean oil inventory has also risen by 4% to 1.45 mln tonnes; hence, oil market will be pressured by further growing supply. But trade concerns have been intensified by U.S. bans on Huawei, import cost has been lifted by a weaker yuan, and China and Canada is still in stalemate, which will help oil market maintain resilient. Overall, short-term oil market is expected to follow futures to post frequent fluctuations within a narrow range, and buyers are suggested to make proper replenishment on the dips and be cautious in driving up prices.
Soybean oil: GB Grade I soybean oil is mainly priced at 5,270-5,400 yuan/tonne in domestic coastal areas, some down by 10-20 yuan/tonne and several up by 10 yuan/tonne. (Tianjin 5,270-5,310, Rizhao 5,310, Zhangjiagang 5,400 and Guangdong 5,330-5,340).
Palm oil: 24-degree palm oil is mainly priced at 4,360-4,420 yuan/tonne in coastal areas, a partial rise of 10 yuan/tonne. (Tianjin 4,380-4,390, unchanged; Rizhao 4,420, up 10; Zhangjiagang 4,360, unchanged; Guangzhou 4,370; and Xiamen not offered).
Imported rapeseed oil: Imported rapeseed oil stays broadly stable today, of which it settle at 7,110-7,200 yuan/tonne in coastal areas. (Fujian 7,080, stable; Guangdong 7,060, stable; and Guangxi 7,200, stable). Rapeseed oil market has few buyers recently as its demand is severely influenced by its enlarging spread with soybean oil and palm oil. Moreover, as soybean crush has increased drastically by 15% to 1.94 mln tonnes last week and will remain at such levels in following two weeks, soybean oil inventory has also risen by 4% to 1.45 mln tonnes; and palm oil is also building up its inventory. Therefore, rapeseed oil market will be dragged down. However, 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 will remain at high levels instead of slump before a thaw in tensions between Beijing and Ottawa, but it will see sharp losses on a detente in trade war. Buyers can just wait on the sidelines.
Cottonseed oil: Cottonseed oil today stays stable with a rise of 50 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. However, the upward potential of cottonseed oil is curbed by the limited cottonseed oil volume for blending, thin turnover of new orders, and high fundamental pressure in oils market. Besides, today spots soybean oil partially lower 10-20 yuan/tonne. Short-term cottonseed oil is likely to remain stable with good momentum for growth and buyers are suggested to take a hand-to-mouth buying strategy.
(USD $1=CNY 6.90)
