Today is 03/29/2024

Daily Review on Markets for Oilseeds and Oils in China--14/8/2019

2019-08-14 www.cofeed.com

Today (Aug. 14th), the market for oilseeds and oils in China is shown as follows:
 
Oilseeds:

Imported soybean: Imported soybean price is steady today, among which Russian soybean is unchanged at 4150 yuan/tonne from last Friday. China's soybean market is still supported by the small supply in Tianjing port and the short-term US soybean import restriction even though the trade relationship has eased when Chinese, U.S. chief trade negotiators hold phone talks on Tuesday, agreeing to hold another phone conversation in two weeks. And US announce that the 10% tariff should be delayed to December 15 for certain articles from China. However, the bumper crop harvest in South America and huge global supply still curbs China's imported and distributed soybean market. 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 upward potential is curbed because the cottonseed trading is not much as most of oil mills halt the operation due to poor crush margin, and the mills that are operating are reluctant to purchase. Short-term price is likely to go strong. Buyers are suggested to make a small replenishment upon low price.

Oils: 

Summary: Chief of the Chinese delegation spoke by phone with trade representatives of the United States on Tuesday and both parties agreed to speak again via phone within two weeks. And U.S. President postponed his deadline for 10% tariffs on remaining Chinese imports till December 15, for the sake of blunting the impact on U.S. Christmas sales. On signs of easing tensions in the U.S-China trade frictions, U.S. soybean rose last night, US stock market and crude oil also surged overnight, and off-shore China’s yuan also appreciated substantially even to 7, but oil futures snap off rises to decline on the Dalian Commodity Exchange today. In spot markets, soybean oil and palm oil drop by 10-60 yuan/tonne and the trading is weaker. Soybean crush remains relatively small due to swelling soybean meal inventories in Guangdong and Sichuan, while soybean oil deliveries have been increased as the market is stocking up for holidays; hence, soybean oil inventory is decreasing. So is palm oil inventory. Besides, soybean crops are now in the critical period of growth, which requires very favorable weather condition, especially under a sharp cut in planting acreage, and there may be more weather speculations later. And there is little chance that trade disputes can be settled in a short period. Therefore, mills are persisting in propping up prices. Oil futures begin to narrow down their losses after falling broadly in early trading, so the oil market seems to be resilient at present and it cannot be said there has been an end to its strong trend. Oil prices have also been at a high level after rallying in row, so buyers are cautious now. Market participants can wait for latest news.

Soybean oil: GB Grade I soybean oil is mainly priced at 5,920-6,150 yuan/tonne in domestic coastal areas, down by 10-60 yuan/tonne. (Tianjin 5,950-5,960, Rizhao 5,920, Zhangjiagang 6,150, and Guangzhou 6,070). 

Palm oil: 24-degree palm oil is mainly priced at 4,740-4,910 yuan/tonne in coastal areas, mostly down by 10-50 yuan/tonne. (Tianjin 4,830-4,840, down 40; Rizhao 4,900-4,910; Zhangjiagang 4,800, down 50 yuan from yesterday afternoon; Guangzhou 4,740, down 10; and Xiamen not offered). 

Imported rapeseed oil: Imported rapeseed oil declines in price today, of which it goes down by 20-30 yuan to settle at 7,180-7,250 yuan/tonne in coastal areas. (Fujian 7,200, stable; Guangdong not offered; and Guangxi 7,280, stable). The demand for rapeseed oil is subject to its big price gap with soybean oil and palm oil, bringing a dismal scene to its market. Besides, the operation rate for soybean crush will keep increasing with huge arrivals of soybean at ports. Hence, rapeseed oil market is dragged down. But rapeseed supply in China may get tightened due to pending issues between China and Canada, and the market is stocking up packing oil in full swing; thus, these have both helped support the market. Overall, short-term market may have little downside space and may fluctuate narrowly to edge up at high levels, and buyers can stay on the sidelines for the moment. 

Cottonseed oil: Cottonseed oil today stays stable when operation rate and output are both low; oil market is in a busy season of restocking for packing oil amid many orders waiting for delivery. However, the market is curbed when cottonseed oil consumption for blending oil is at a limited level; the US-China trade tension eases as U.S. chief trade negotiators hold phone talks on Tuesday, agreeing to hold another phone conversation in two weeks, and US announce that the 10% tariff should be delayed to December 15 for certain articles from China; spot soybean oil and palm oil decline 10-60 yuan/tonne. Short-term cottonseed oil is likely to move sideways. Buyers can just wait on the sidelines and wait for the news.

(USD $1=CNY 7.03)