Today (Jun. 21st), 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 yesterday, and Uruguayan soybean price is unchanged from yesterday at 4,370 yuan/tonne. Quotations from traders keep strong due to a small amount of imported and distributed soybean supply from Tianjin port and a favorable demand. Chief trade negotiators of China and the United States will communicate in line with the instructions made by the two heads of state and make preparations for the meeting of the two heads of state during the G20 Summit, the Ministry of Commerce (MOC) said Thursday. Although US-China trade relationship is expected to improve, US soybean import is still restricted ahead of an agreement made by the two parties, which is favorable to China's market. 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 prices are stable due to the reducing supply of cottonseed and traders' selling-loath mood. However, cottonseed market is weighted on when operation rate and purchase activity are lower on barley harvest and poor crush margin; quantity of market trading is not a lot. Short-term prices are likely to fluctuate in narrow range and buyers are suggested to stay on the sideline for the present.
Oils:
Summary: U.S. soybeans posted bounces in overnight trading on the forecast for more rains, but oil futures fluctuate to inch lower on the Dalian Commodity Exchange today on resumed trade talks after China’s Ministry of Commerce said the heads of the two trade teams would communicate according to instructions passed down from the two presidents, and South China Morning Post said in a report that the communication would be carried out in Osaka next Tuesday. In the physicals, soybean oil and palm oil steadily fluctuate by 10-20 yuan/tonne in tepid trading. Domestic market reacts negative to the resumed trade talks between China and the United States. Besides, soybean oil inventory keeps increasing as the utilization rate for soybean crush will pick up to a high level due to huge volume of soybean arriving at port in the third quarter. Therefore, short-term oil market will maintain its fluctuations in correction territory. But U.S. soybeans will remain strong on weather speculations, and it is still to early to expect a trade deal in trade talks, so there will be little downside space for current low prices. Buyers can wait on the sidelines or buy on short-term demand.
Soybean oil: GB Grade I soybean oil is mainly priced at 5,190-5,370 yuan/tonne in domestic coastal areas, partially fluctuating by 10-20 yuan/tonne. (Tianjin 5,190-5,200, Rizhao 5,220, and Zhangjiagang 5,370, and Guangzhou 5,320).
Palm oil: 24-degree palm oil is mainly priced at 4,280-4,340 yuan/tonne in coastal areas, partially down by 20 yuan/tonne. (Tianjin 4,320-4,340, down 20; Rizhao 4,330, flat; Zhangjiagang 4,280, flat; Guangzhou 4,280-4,290, flat; and Xiamen not offered).
Imported rapeseed oil: Imported rapeseed oil further drops today, of which it settles down 10-30 yuan at 6,840-7,000 yuan/tonne in coastal areas. (Fujian 6,840, down 30; Guangdong 6,870, down 20; and Guangxi 7,000, stable). Rapeseed oil market is dragged down by bearish fundamentals. For one thing, its demand is severely affected by its large price spread with soybean oil and palm oil; for another, soybean oil inventory is piling up as mills maintain high utilization rate for huge soybean import from June to September, and palm oil is also in adequate stockpiles. But rapeseed points to a tight supply outlook in the second half of July amid tensions between China and Canada, and this may limit the price declines and help prices maintain at a high level. Buyers can wait for low and stable prices to buy in small lot on the dips.
Cottonseed oil: Cottonseed oil today stays stable with low trading volume. And some support comes from the following situations that the operation rates and output are low on barley harvest and poor crush margins; cottonseed price is strong. However, cottonseed oil is weighted on owing to the limited consumption for cottonseed oil as blending oils, thin turnover of new orders, high fundamental pressure in main oil market, and poor delivery volume. Short-term cottonseed oil is likely to fluctuate narrowly and buyers can stay on the sideline for the present.
(USD $1=CNY 6.87)
