Today (Jun. 26th), the market for meals in China is shown as follows:
Soybean meal: U.S. soybean futures traded lower overnight as the weather in the latest forecast pointed to a favorable outlook for accelerating soy planting in Midwest. There is sign of a detente between China and the United States as Bloomberg reported that the two presidents would officially agree to resume trade talks at the G20 summit, and the United States would postpone its additional tariff on $ 300 bln worth of Chinese goods, so meal futures are forced to fall on the Dalian Commodity Exchange today. Spot bids for soybean meal follow to drop by 10-30 yuan/tonne in tepid trading. Specifically, the price settles at 2,810-2,910 yuan/tonne in coastal areas. (Tianjin 2,910, Shandong 2,870-2,880, Jiangsu 2,860-2,880, Dongguan 2,810-2,830, and Guangxi 2,820-2,850). U.S. soybean futures are now kept under check by high stockpiles of old beans in the United States and bumper harvests in Argentine. Domestically, oil mills have picked up their utilization rate for soybean crush in view of huge import volume at ports in the second quarter, while soybean meal has been in weak trading as the African swine fever is still a curb on later demand, so meal prices turn negative. But due to huge uncertainties in weather conditions and trade talks, short-term soybean meal price will unlikely collapse and may fluctuate narrowly to adjust. Market participants can focus on the planting acreage and inventories in the report by the USDA and trade talks later this month.
Imported rapeseed meal: Imported rapeseed meal declines today, of which it settles down 30-40 yuan at 2,570-2,630 yuan/tonne in coastal areas. (Guangxi not offered; Guangdong 2,630, down 30; and Fujian 2,620, down 30). Rapeseed meal in feed has been largely replaced by soybean meal due to their small price difference, and soybean crush has maintained at a high level due to its huge import in the second quarter. Besides, the African swine fever is still spreading. Hence, rapeseed meal has come under pressure. However, it is unlikely that China and Canada will fix their mutual relationship immediately now that China have suspended all import of meat products from Canada from today. And rapeseed will head for a tight supply outlook in the second half of July, and mills are propping up prices in view of declining rapeseed meal inventory in coastal areas due to surging demand from the aquaculture in South China, so there will be little room for price declines. Buyers can wait for low and stable prices to make replenishment on the dips.
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 weak 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: Cottonseed meals today are stable with some strong fluctuations of 30-150 yuan/tonne. Some support comes from that operation rate and output is low; cottonseed price is strong; and new order turns better on a tight demand from aquatic farming in some regions. However, today meals on DCE fall back and accordingly spot soybean meal decline 10-30 yuan/tonne as the spread of ASF greatly impacts demand for cottonseed meal; the substitution of soybean meal from cottonseed meal happens in feed factory on the narrow price spread between soybean meal and cottonseed meal; demand in downstream is not good; US soybean planting will speed up on an improved weather in the Midwest, according to latest weather forecast; and the U.S.-China trade tension is expected to ease when the two heads of state would likely agree to restart negotiations during the G20 Summit and US would likely refrain from putting the 25% tariffs on the remaining $300 billion in Chinese goods, according to Bloomberg news. Short-term cottonseed meal is likely to fluctuate in narrow range , and buyers are suggested to stay on the sideline for the present and wait for the news of this week's meeting between U.S. President Donald Trump and China President Xi Jinping.
(USD $1=CNY 6.89)
