Today (Jul. 9th), the market for meals in China is shown as follows:
Soybean meal: U.S. soybean futures inched higher last night, but meal futures post sharp losses on the Dalian Commodity Exchange today because of worries over weak demand. Spot bids for soybean meal drop by 20-50 yuan/tonne in tepid trading. Specifically, the price settles at 2,650-2,730 yuan/tonne in coastal areas. (Tianjin 2720, Shandong 2,680-2,720, Jiangsu 2,680-2,730, Dongguan 2,650-2,730, and Guangxi 2,700-2,730). U.S. soybean futures were buoyed by slow planting and low good-to-excellent rating. China is expected to increase its U.S. soybean import amid a detente in trade relations, whilst global soybean is in huge supply. These will depress soybean prices. Meanwhile, the demand for meal is also subdued as the African swine fever has caused a sharp decline in pig amount and broiler farmers have suffered some losses. Due to the delicate trading since June, soybean meal has been piling up with an increase of 3% to 920,000 tonnes last week, so that more and more mills are forced to halt by swelling inventories. This is a curb on meal prices. But weather speculation may return as U.S. soybean will gradually enter into critical growth period in the second half of this month, and the uncertain trade talks may become a bullish factor to the market. As prices are still in correction territory, buyers can wait for low and stable prices to make appropriate replenishment on the dips.
Imported rapeseed meal: Imported rapeseed meal drops today, of which it settles down 20-40 yuan at 2,400-2,500 yuan/tonne in coastal areas. (Guangxi not offered; Guangdong 2,420, down 40; and Fujian 2,400, down 40). Feed mills make swingeing cuts in rapeseed meal due to its large price spread with soybean meal. Soybean import is estimated to reach 29 mln tonnes in the third quarter, and state-owned firms are expected to resume U.S. soybean purchase due to the restart of trade talks. In the meantime, the demand for meal is also subdued as the African swine fever has caused a sharp decline in pig amount and broiler farmers have suffered some losses, which has led to growing inventories of soybean meal and rapeseed meal. And rapeseed meal price is thus depressed. But rapeseed may head for a tight supply in the second half of July since it is unlikely for China and Canada to solve their conflicts in a short time, and there may be again weather speculation on U.S soybeans, which can help limit price declines. Buyers can wait for low and stable prices to make proper 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 109,000 tonnes, Fuzhou 25,000 tonnes, Shanghai 78,000 tonnes, Tianjin 1,000 tonnes, Dalian 19,000 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 1,630 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. A slow recovery in aquaculture and the ongoing African swine fever have jointly limited the demand for fishmeal and made its fall far behind the import volume, so that the inventory has reached a total of 238,000 tonnes; hence, domestic fishmeal market is bearish. But there is still support from firm prices abroad and price inversions at home and abroad. Overall, fishmeal market is predicted to keep steady in the short run.
Cottonseed meal: Cottonseed meals today are stable with some drops of 20-120 yuan/tonne, 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 for cottonseed meal happens in feed factory; demand in downstream is sluggish; today meals on DCE greatly fall back and spot soybean meal declines 20-50 yuan/tonne. However, oil mills are still waiting for a higher offers as the operation rates and output are low; cottonseed price is strong. Amid a shortage of favorable factors, short-term cottonseed meal is likely to experience a weak adjustment, and buyers can maintain wait-and-see attitudes for now.
(USD $1=CNY 6.88)
