Today (May 22nd), the market for oilseeds and oils in China is shown as follows:
Oilseeds:
Imported soybean: Imported soybean price is stable with some rises today, among which non-GM Canadian soybean is not offered for out of stock, and non-GM Russian soybean is unchanged from yesterday to settle at 3,450 yuan/tonne, non-GM Kazakhstan soybean rises by 20 yuan/tonne from yesterday to settle at 4,250 yuan/tonne. 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 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 go strong.
Cottonseed: Cottonseed prices today are stable with some rises of 0.02 yuan/kg due to the decreasing cottonseed quantity putting pressure on market supply and the optimistic outlook supporting traders' selling-loath mood. 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: The Trump administration is considering payments of $2 per bushel for soybean farmers to help them through the tariff war and only 4 cents per bushel for corns, which will encourage more soybean planting. U.S. soybeans saw another loss last night, and oil futures reverse to decline on the Dalian Commodity Exchange today. In spot market, soybean oil and palm oil fall by 20-60 yuan/tonne in weaker trade as some buyers finished replenishment yesterday. Mills have been active in soybean crush for handsome margins, sending soybean weekly crush to a high level above 1.90 mln tonnes in recent weeks. Soybean oil inventory has thus increased by 4% weekly to 1.45 mln tonnes. Meanwhile, mills are propping up meal prices for their good trading recently. Therefore, oil market is weighed down. But amid ongoing trade concerns between Beijing and Washington and tensions between Beijing and Ottawa, short-term oil market will have little space for price declines and may follow futures to post frequent fluctuations. Buyers can wait for steady declines to make proper replenishment.
Soybean oil: GB Grade I soybean oil is mainly priced at 5,220-5,340 yuan/tonne in domestic coastal areas, down by 20-50 yuan/tonne. (Tianjin 5,220-5,230, Rizhao 5,310, Zhangjiagang 5,340 and Guangdong 5,270-5,290).
Palm oil: 24-degree palm oil is mainly priced at 4,300-4,340 yuan/tonne in coastal areas, adown 30-60 yuan/tonne. (Tianjin 4330-4340, down 50; Rizhao not offered; Zhangjiagang 4,300, down 60; Guangzhou 4,340; and Xiamen not offered).
Imported rapeseed oil: Imported rapeseed oil stays broadly stable today, of which it settle at 7,040-7,200 yuan/tonne in coastal areas, down 30-40 yuan/tonne. (Fujian 7,050, down 30; Guangdong 7,030, down 30; 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. Global soybean has a huge supply, and domestic crush is expected to soar for good margins. Soybean oil thus and palm oil inventories have been growing. 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. Short-term rapeseed oil will extend its high prices before a thaw between Beijing and Ottawa, but it will take plunge upon a detente. Buyers can just wait on the sidelines.
Cottonseed oil: Cottonseed oil today stays stable with a rise of 50 yuan/tonne 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 and palm oil lower 20-60 yuan/tonne. Short-term cottonseed oil is likely to remain relatively stable and buyers are suggested to take a hand-to-mouth buying strategy.
(USD $1=CNY 6.92)
