Today (May 28th), the market for meals in China is shown as follows:
Soybean meal: U.S. soybean closed yesterday, and is traded up 14 cents on Globex today. Meal future rush to further high on the Dalian Commodity Exchange. Spot soybean meal goes up 20-40 yuan from yesterday to attract some purchases at low prices, but total trading volume is low as buyers remain cautious. Specifically, the price settles at 2,790-2,860 yuan/tonne in coastal areas. (Tianjin 2,860, Shandong 2,840-2,860, Jiangsu 2,810-2,840, Dongguan 2,810-2,820, and Guangxi 2,790-2,820). Rising premiums in South American crops have raised import cost, aquaculture has been on the way, and mills have seen a weekly decline of 0.6% and of 46% from a year earlier to 610,000 tonnes in inventory under strong trading due to small spread between soybean meal and other meals. Therefore, soybean meal price is buoyed to rise. But mills are active in importing and keeping their utilization rate high due to good crush margins. In addition, there are underlying risks such as the lingering ASF, especially in Guangxi, and the ongoing trade frictions. The market has raised the speculation on U.S. soybean weather, and U.S. President said he was not ready for a deal with China. Overall, soybean meal price will likely extend its strong trend in the near term.
Imported rapeseed meal: Imported rapeseed meal goes up today, of which it settles up 10-20 yuan at 2,430-2,480 yuan/tonne in coastal areas. (Guangxi not offered; Guangdong 2,480, up 30; and Fujian 2,480). Rapeseed meal market is buoyed by a tight supply outlook of rapeseed whose import is blocked by tensions between Beijing and Ottawa. But feed factories have replaced rapeseed meal substantially with soybean meal on account of their narrowing spread, and soybean crush is still at a high level due to good margins in South American crops. Besides, buyers remain cautious on account of the African swine fever. For growing speculation on U.S. soybean weather, and China’s tensions with the United States and Canada, rapeseed meal will stay strong in the short term.
Imported fishmeal: Imported fishmeal prices keep steady amid tepid shipments at port today. Quotation at ports: it is priced steadily at 10,400-10,500 yuan/tonne for Peruvian ordinary SD with 65% protein content, 10,700-10,800 yuan/tonne for Thai SD with 67% protein content, 11,100-11,200 yuan/tonne for Japanese SD with 67% protein content and 11,400-11,600 yuan/tonne for super steam fishmeal with 68% protein content. Stocks at port: Huangpu 96,000 tonnes, Fuzhou 22,000 tonnes, Shanghai 82,000 tonnes, Tianjin 1,000 tonnes, Dalian 17,000 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. Domestic holders are encouraged to prop up prices by stable foreign quotations and growing import cost, which is positive to domestic fishmeal market. But further price rises are still pressured by weak demand and high stockpiles. Overall, fishmeal market will probably keep steady to consolidate in the short term.
Cottonseed meal: Cottonseed meals today are stable with some rises of 50-100 yuan/tonne, as the operation rates and output are low; cottonseed price is strong; and the trade war concerns push meals on DCE to keep reaching its high level, spots soybean meal up 20-40 yuan/tonne. However, ASF drags down demand for cottonseed meal. Moreover, 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 and the trading of new order for cottonseed meal is slow. Short-term prices are likely to go strong. Buyer shouldn't chase high bids too far when the trade talks are very uncertain.
(USD $1=CNY 6.90)
