Today (Jun. 25th), the market for meals in China is shown as follows:
Soybean meal: U.S soybeans traded higher last night on worry over further planting delays due to wet weather in Midwest and on upbeat sentiment for trade talks later this week, and meal futures expand small gains on higher opens on the Dalian Commodity Exchange today. Spot bids for soybean meal steadily edge up by 10-20 yuan/tonne to attract some deals at low prices, but the total trading volume remains low. Specifically, the price settles at 2,820-2,920 yuan/tonne in coastal areas. (Tianjin 2,920, Shandong 2,890-2,900, Jiangsu 2,890-2,900, Dongguan 2,830-2,850, and Guangxi 2,830-2,880). As of June 23rd, 85% of the soybean crop has been planted, behind the 100% a year earlier and the five-year average of 97%, while 54% of the crop was in good-to-excellent condition, behind 73% of the corresponding period last year. The weather speculation will continue to provide support for meal prices. But the upward potential of U.S. soybeans is kept under check by huge global soybean supply. Meanwhile, the African swine fever still shadows the outlook of later demand for meal, and soybean meal has been trading light recently. Therefore, meal prices react negative to these fundamentals. Market participants are not expecting a trade deal in this round of meeting, but there may be some progress. Both the bulls and the bears are now remain cautious, so short-term soybean meal prices will mainly fluctuate at a narrow range. Buyers out of stock are suggested to make replenishment in small batch on the dips, but to remain cautious in driving up prices.
Imported rapeseed meal: Imported rapeseed meal rises today, of which it settles up 40-50 yuan at 2,610-2,660 yuan/tonne in coastal areas. (Guangxi not offered; Guangdong 2,660, up 40; and Fujian 2,650, up 40). With surging demand from the aquaculture in South China and declining utilization rate for rapeseed crush in mills, rapeseed meal inventory continues to fall in coastal mills, who have thus set limited quantity for shipments. Besides, it is unlikely that China and Canada will fix their mutual relationship immediately, so rapeseed will point to a tight supply outlook in the second half of July. These will help shore up the market. But soybean crush will maintain at a high level for huge imports at port, and the African swine fever still shadows the prospect of later demand for meal, so there will be limited room for price rises. Buyers are suggested not to drive up prices excessively.
Imported fishmeal: Imported fishmeal prices are flat today amid tepid shipments at port today. Quotation at ports: it is priced steadily at 10,100-10,200 yuan/tonne for Peruvian Fair Average Quality SD with 65% protein content, 10,400-10,600 yuan/tonne for Thai SD with 67% protein content, 10,800-11,100 yuan/tonne for Japanese SD with 67% protein content and 11,200-11,400 yuan/tonne for super steam fishmeal with 68% protein content. Stocks at port: Huangpu 102,000 tonnes, Fuzhou 21,000 tonnes, Shanghai 78,000 tonnes, Tianjin 1,000 tonnes, Dalian 18,000 tonnes, Fangchenggang 1,000 tonnes and 4,000 tonnes at other ports. Spot price (FOB) in foreign market stays stable today: it is 1,410 USD/tonne for Peruvian Fair Average Quality SD fishmeal with 65% protein content and down by 20 USD at 1,580 USD/tonne for Prime SD fishmeal with 68% protein content. Chilean Fair Average Quality fishmeal with 65% protein content is quoted steadily at 1,410 USD/tonne, and prime with 68% protein content at 1,640 USD/tonne. There are a myriad of negative factors, ranging from lower quotations in foreign market, to high stockpiles at ports due to delicate demand under the African swine fever and the aquaculture subject to the strong rainfalls in South China. In a hybrid of the bull and the bear, fishmeal market will keep steady to decline slightly in the short run.
Cottonseed meal: Today cottonseed meal mostly stays stable with a drop of 50 yuan/tonne for some prices when the spread of ASF greatly impacts demand for cottonseed meal; 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; the trading of new order for cottonseed meal is slow. However, the price decline is curbed as the operation rates and output are low; cottonseed price is strong; today meals on DCE see a slight rise with high opening and spot soybean meal is stable with a rise of 10-20 yuan/tonne. Short-term cottonseed meal is likely to fluctuate narrowly, and buyers can take a hand-to-mouth buying strategy for the moment and wait for the news of this week's trade talks.
(USD $1=CNY 6.88)
