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Daily Review on Meal Market in China--31/7/2019

2019-07-31 www.cofeed.com
Today (Jul. 31st), the market for meals in China is shown as follows:

Soybean meal: U.S. soybean closed lower in overnight trading, for it was scarcely possible that China and the United States would reach a deal in their trade talks yesterday and today, especially after President Donald Trump tweeted to censure that China had not bought more U.S. agricultural products as supposed, but meal futures fluctuate to inch high on the Dalian Commodity Exchange (DCE) today as traders close their positions after taking profit in the arbitrage of buying oils and selling meals. Spot bids for soybean meal steadily fluctuate by 10-20 yuan/tonne, and the trading remains tepid as buyers remain cautious in view of weak upward potentials on the DCE. Specifically, the price settles at 2,740-2,790 yuan/tonne in coastal areas. (Tianjin 2,790, Shandong 2,750-2,780, Jiangsu 2,750-2,770, Dongguan 2,740-2,760, and Guangxi 2,750-2,770). Currently, U.S. soybean crops are growing under a normal weather pattern. And China mills will gradually pick up their operation rate due to huge soybean import, whilst the African swine fever still keeps a lid on the feed demand. Therefore, soybean meal prices have limited upward impetus. Buyers are suggested to appropriately replenish on the dips and remain cautious in driving up prices. 

Imported rapeseed meal: Imported rapeseed meal rises in price today, of which it settles up 10-20 yuan at 2,360-2,460 yuan/tonne in coastal areas. (Guangxi not offered; Guangdong 2,460, up 10; and Fujian 2,360). Rapeseed meal prices have received some support from the tight supply outlook of rapeseed amid pending issues between China and Canada and the underlying weather speculation on the growth of U.S. soybean crops. Its demand, however, is badly influenced by its largely narrowed price spread with soybean meal. Besides, the demand for meals has been gloomy due to a sharp decline in hog amount caused by the African swine fever, which has at full tilt hit Sichuan, Hunan and Hubei recently. soybean import will be huge in the next four months. Therefore, rapeseed meal will have limited upward potentials. Buyers can make appropriate replenishment on the dips and remain cautious in driving up prices.

Imported fishmeal: Imported fishmeal prices stay stable today, and there is a price gap between new and old fishmeal. Quotation at ports: it is priced steadily at 9,900-10,000 yuan/tonne for Peruvian Standard SD with 65% protein content, 10,200-10,300 yuan/tonne for Thai SD with 67% protein content, 10,500-10,600 yuan/tonne for Japanese SD with 67% protein content and 10,800-11,200 yuan/tonne for super SD with 68% protein content. Stocks at port: Huangpu 126,000 tonnes, Fuzhou 31,000 tonnes, Shanghai 82,000 tonnes, Tianjin 1,000 tonnes, Dalian 24,000 tonnes, Fangchenggang 1,000 tonnes and 4,000 tonnes at other ports. Peruvian merchants have quoted steadily today: it is 1,340 USD/tonne for Peruvian Standard SD with 65% protein content and 1,540 USD/tonne for super SD with 68% protein content. Chilean Standard SD with 65% protein content is 1,360 USD/tonne, and super SD with 68% protein content at 1,590 USD/tonne. Fishmeal market is negative due to high stocks at port amid tepid demand at home and constant arrivals of new products from Peru, but it is still propped up by price inversions at home and abroad. Therefore, fishmeal market is predicted to keep steady with slight declines in the short run.

Cottonseed meal: Today cottonseed meal mostly stays stable with a rise of 40 yuan/tonne for some prices when operation rate keep at a low level amid a low level of inventory; there are still some rigid demands in downstream. However, the overall demand is not good due to African swine fever and the narrow price spread between soybean meal and cottonseed oil. Short-term cottonseed meal is likely to fluctuate in narrow range. Buyers with insufficient stock can replenish properly in small batches and be prudent if chasing high. Buyers should also pay attention to the ongoing trade talks as Trump accused China of not following through on promises to buy more U.S. agricultural products in tweets.

(USD $1=CNY 6.87)