Today (Jun. 17th), the market for oilseeds and oils in China is shown as follows:
Oilseeds:
Imported soybean: Imported soybean price is steady today, among which Myanmar and Ukraine soybean is not offered for out of stock, Kazakhstan soybean is unchanged at 4,470 yuan/tonne from last Friday, and Uruguayan soybean price is 4,370 yuan/tonne. China's soybean market is favourable on traders' optimistic outlook and strong offers as the arrivals in Tianjin ports are little compared with the good demand and quick stock consumption. 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: Today cottonseed mostly stays stable with a drop of 0.04 yuan/kg for some prices and is weighted on when operation rate and purchase activity are lower on barley harvest and poor crush margins; cottonseed transport is not good as the demand for vehicles from Xinjiang to inland increases on Xinjiang fruit marketing; quantity of market trading is not a lot. However, the market is supported by a decreasing cottonseed supply day by day. Short-term prices likely continue to fluctuate in narrow range and buyers are suggested to take a hand-to-mouth buying strategy.
Oils:
Summary: U.S. soybean futures saw further gains on wet weather in production areas, but oil futures point to narrow-range fluctuations on the Dalian Commodity Exchange for the arbitrage of buying meals and selling oils. In spot markets, soybean oil and palm oil post a partial loss of 10-40 yuan/tonne in tepid trading. Domestic oil futures have made tentative bounces on the back of U.S. soybean futures in early trading, but have reversed to drop very soon. The trading volume in oil market has been cut down by half by slack demand last week. In addition, soybean crush may climb back to above 1.80 mln tonnes for the next two weeks. Oil market is thus dragged down. But it will not slump in the short term due to unfavorable weather conditions for U.S. soybeans, and will continue its fluctuations at a narrow range on the back of futures. Buyers can wait for steady declines to make proper replenishment on the dips.
Soybean oil: GB Grade I soybean oil is mainly priced at 52,40-5,400 yuan/tonne in domestic coastal areas, partially down by 10-30 yuan/tonne. (Tianjin 5,240-5,250, Rizhao 5,240, and Zhangjiagang 5,400, and Guangzhou 5,330).
Palm oil: 24-degree palm oil is mainly priced at 4,290-4,350 yuan/tonne in coastal areas, down by 10-40 yuan/tonne. (Tianjin 4,340-4,350, down 10; Rizhao 4,350, down 30; Zhangjiagang 4,300, down 40; Guangzhou 4,290, down 20; and Xiamen not offered).
Imported rapeseed oil: Imported rapeseed oil rises today, of which it settles down 20-30 yuan at 7,040-7,200 yuan/tonne in coastal areas. (Fujian 7,040, down 30; Guangdong 7,050, down 20; and Guangxi 7,200, stable). The demand for rapeseed oil is severely curbed by its large price spread with soybean meal and rapeseed meal, and the inventory has thus increased by 11% to 530,000 tonnes in coastal areas last week. Meanwhile, the utilization rate for soybean crush will remain at a high level due to its huge imports in the third quarter. Therefore, rapeseed oil market is dragged down by rising inventories of soybean oil and palm oil. But lingering tensions between Beijing and Ottawa may tighten the supply outlook of rapeseed, in addition to unfavorable weather for U.S. soybeans, rapeseed oil prices will not collapse in the short term, and will maintain at a high level. Buyers can stay on the sidelines.
Cottonseed oil: Cottonseed oil today stays stable with slow trading. And some support comes from the following situations that the operation rates and output are low on barley harvest and poor crush margin; cottonseed price is strong; and US soybeans is going up on weather speculation. However, cottonseed oil is weighted on owing to poor delivery in mills and the limited consumption for cottonseed oil as blending oils as well as 10-40 yuan/tonne partial decline of spot soybean oil and palm oil due to arbitrage of buying meals and selling oils. Short-term cottonseed oil is likely to fluctuate narrowly and buyers can take a hand-to-mouth purchasing strategy.
(USD $1=CNY 6.92)
