Today (Jun. 5th), the market for oilseeds and oils in China is shown as follows:
Oilseeds:
Imported soybean: Imported soybean price is up today, among which Russian soybean is temporarily not offered, Kazakhstan soybean goes up 80 yuan/tonne from yesterday at 4,250 yuan/tonne, and Myanmar soybean rises 40 yuan/tonne from yesterday at 4,330 yuan/tonne. China's soybean market is favourable on traders' optimistic outlook and strong offers as the arrivals in China's ports are little compared with the strong demand and quick delivery pace of traders. Besides, the US soybean import is restricted as uncertain outlook of U.S.-China trade war.
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 partially rise 0.02-0.06 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 maintain proper stock level upon low price.
Oils:
Summary: U.S. soybean edged higher overnight, and oil futures continue their moderate gains on the Dalian Commodity Exchange today as some traders have closed their trade of buying meals and selling oils and domestic soybean oil stockpiles have fallen by 2.6% weekly to 1.41 mln tonnes. In spot markets, soybean oil partly goes up 20-30 yuan/tonne and palm oil broadly holds steady, of which the former has seen weaker trading with some replenishment at low prices since the trading volume amounted to 54,000 tonnes yesterday. In spite of futures gains today, soybean oil is still in adequate stockpiles amid high utilization rate for huge soybean import in the third quarter, so bearish fundamentals will continue to curb oil price rises. But due to “weather-guided market”, oil spots will likely consolidate in fluctuation. Despite its current low price levels, oil will see fair rises once soybean meal is forced to drop and traders close their arbitrage of buying meals and selling oils. Buyers can replenish on the dips to keep safety stockpiles.
Soybean oil: GB Grade I soybean oil is mainly priced at 5,240-5,400 yuan/tonne in domestic coastal areas, some up by20-30 yuan/tonne. (Tianjin 5,240-5,250, Rizhao 5,250, and Zhangjiagang 5,400, and Guangzhou 5,330).
Palm oil: 24-degree palm oil is mainly priced at 4,350-4,400 yuan/tonne in coastal areas. (Tianjin 4,370-4,390, unchanged; Rizhao 4,400, unchanged; Zhangjiagang 4,360, unchanged; Guangzhou 4,350, unchanged; and Xiamen not offered).
Imported rapeseed oil: Imported rapeseed oil steadily fluctuates today, of which it fluctuates by 20-30 yuan to settle at 7,030-7,200 yuan/tonne in coastal areas. (Fujian 7,050, down 20; Guangdong 7,030; and Guangxi 7,120, down 30). Rapeseed oil has lost its buyers as its demand is severely impacted by its large spread with soybean oil and palm oil. In addition, mills will keep high utilization rate for soybean amid its huge import from June to August. Under such negative fundamentals as bumper inventories of soybean oil and palm oil, rapeseed oil market is weighed down. But rapeseed may see supply shortages as there is only two cargoes left for June and July amid tensions between China and Canada. Before a thaw in tensions, rapeseed oil prices will not collapse and will remain high, but buyers can take a hand-to-mouth basis due to high policy risks.
Cottonseed oil: Cottonseed oil today stays stable with a rise of 20-150 yuan/tonne due to low operation rates and output, as well as strong cottonseed prices. Besides, today oils on DCE further see a modest rise and spots soybean oil partially rise 20-30 yuan/tonne. However, the purchase activities are inactive as the limited cottonseed oil volume for blending, thin turnover of new orders, and high fundamental pressure in main oil market. Before weather speculation of US soybeans ends, cottonseed oils are likely to go strong and buyers thereby had better maintain proper stock level upon low price.
(USD $1=CNY 6.91)
