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Daily Review on Markets for Oilseeds and Oils in China--26/07/2019

2019-07-26 www.cofeed.com
Today (Jul. 26th), the market for oilseeds and oils in China is shown as follows:
 
Oilseeds:
 
Imported soybean: Imported soybean price is steady today, among which Brazilian selected soybean for food is not offered for out of stock, and Russian soybean is at 4,150 yuan/tonne, unchanged from yesterday. The insufficient quantity of imported and distributed soybean supports the prices. However, if the 12th round of U.S.-China trade talks next week in Shanghai goes well, US soybeans imports later likely increase. Add the off-season period of soybean demand and global ample supply and the imported and distributed soybean is negative. The market is mixed and short-term prices likely maintain stable.
 
Cottonseed: Cottonseed prices today are partially stable with most purchase activities suspending, due to the declining supply of cottonseed, and a certain period before the marketing of new cottonseed. However,  the market is curbed because the cottonseed trading is not much as oil mills are reluctant to purchase and some mills mainly use its own stock due to poor crush margin. Short-term price is likely to stay stable with fluctuation in narrowed range and buyers can take a hand-to-mouth purchasing strategy.
 
Oils: 
 
Summary: U.S. soybean fell overnight on dismal exports, and on the Dalian Commodity, soybean oil futures snap off rises to edge lower as traders close their position after gaining on long positions and palm oil continues to inch higher. Chinese government was said to approve some 6 mln tonnes of import quotas in two tranches for U.S. soybeans free of the additional tariff for crushing enterprises, and has already approved some enterprises to purchase U.S. corn, cotton, sorghum and pork with tariff exemptions. Therefore, soybean oil futures are dragged down today and soybean oil spot prices are also weighed down in rebounding. But mills still maintain low operation rate due to swelling soybean meal inventories and packing oil stockpiling is underway; hence, oil prices will have little downward space and the overall trend will probably fluctuate to consolidate. Participants can pay attention to the U.S.-China trade talks in Shanghai on next Tuesday and Wednesday. 
 
Soybean oil: GB Grade I soybean oil prices have mostly snapped off losses to settle at at 5,350-5,520 yuan/tonne in domestic coastal areas, with some declines of 10-20 yuan/tonne. (Tianjin 5,350-5,370, Rizhao 5,370, Zhangjiagang 5,520, and Guangzhou 5,450-5,460). 
 
Palm oil: 24-degree palm oil is mainly priced at 4,350-4,430 yuan/tonne in coastal areas, some down by 10-20 yuan/tonne. (Tianjin 4,390-4,400, up 10; Rizhao not offered; Zhangjiagang 4,330, flat; Guangzhou 4,350, up 20; and Xiamen not offered).
 
Cottonseed oil: Cottonseed oil today stays stable due to the low operation rate, high cottonseed price ,and the start for the season of packing-oil stockpiling. However, cottonseed oil is weighted on by the limited consumption for cottonseed oil as blending oils, and high fundamental pressure in staple oil market. Besides, soybean oil on DCE slip a bit and spot soybean oil mostly is stable with a drop of 10-20 yuan/tonne. Short-term cottonseed oil is likely to strongly fluctuate. Buyers may make small replenishment upon low prices if out of stock. And pay attention to the U.S.-China trade talks in Shanghai next Tuesday and Wednesday.
 
Imported rapeseed oil: Imported rapeseed oil declines today, of which it drops by 20-50 yuan at 6,890-7,000 yuan/tonne in coastal areas. (Fujian not offered; Guangdong 6,920, down 20; and Guangxi 7,000, down 50). Rapeseed meal market has few buyers recently since its demand is severely cut by its widened price gap with soybean oil and palm oil. Besides, there is a rumour that two new cargoes of rapeseed are bought this week, and oil mills will probably maintain high utilization rate on account of huge soybean arrivals at port in the third quarter amid a high level of soybean oil inventory in this year. Add the restart of U.S.-China trade talks next Tuesday and the rapeseed oil is dragged down. However, rapeseed is in a tight supply outlook as it is difficult for China and Canada to settle their issues in the near run. And the peak season for the small packing oil stockpiling is coming soon. Hence, rapeseed oil may receive some support to extend high-level, narrow-range fluctuations. 
 
  (USD $1=CNY 6.87)