Today is 01/11/2025

Daily Review on Meal Market in China--08/10/2019

2019-10-08 www.cofeed.com
Today (Oct. 08), the market for meals in China is shown as follows:

Soybean meal: US soybeans dropped 1 cent last night to 915.25 cents, but gained 29.85 cents from that session before China’s National Day holiday. The U.S. Department of Agriculture pegged soybean stocks at 913 million bushels as of September 1, below the market estimate of 982 million bushels, and the freeze has sporadically appeared in some parts of the U.S. Midwest. Meanwhile, the U.S. and China are to hold high-level trade negotiations in Washington on October 10 and 11, and China has purchased a total of about 3.5 million tonnes of soybeans ahead of the negotiations, with 914,000 tonnes bought during the National Day holidays. US soybeans were buoyed to rise for several straight sessions, and meal futures also fill up gains after the trading resumes on the Dalian Commodity Exchange today and are expanding gains. Spot soybean meal prices increase by 40-70 yuan/tonne from those before the holiday with some low-level purchases, yet with lukewarm trading at high levels. Specifically, the price settles at 2,960-3,010 yuan/tonne in coastal regions (Tianjin 3,080, Shandong 3,050-3,070, Jiangsu 2,950-3,010, Dongguan 2,960-3,000, and Guangxi 2,950-2,990). With a huge drop in operation rate during the National Day holiday, the inventory of soybean meal also decreased. Moreover, the overall profit in the breeding industry is quite decent, and local governments are providing strong support for resuming hog breeding. Mills are thus trying to prop up price, and this is bullish to meal prices. But the price rises may be subdued by the African swine fever and the upcoming harvest and sales of US soybeans. Buyers are suggested to replenish on the dips for appropriate stocks, but not to drive up prices excessively. 

Imported rapeseed meal: Imported rapeseed meal rises in price today, of which it settles up 30-40 yuan/tonne at 2,350-2,460 yuan/tonne in coastal areas (Guangxi 2,350, up 30; Guangdong 2,460, up 40; Fujian 2,380, up 40). There is no progress in the over disclosure hearing about Meng Wanzhou, and it’s hard to resolve the issues between China and Canada in a short term, so rapeseed supply is getting tightened. Thus, rapeseed meal price is buoyed. But domestic breeding can hardly recover very soon, so there is not much improvement in terminal demand. Moreover, the harvesting and marketing of new US soybeans are approaching. Therefore, these factors limit the upward space of rapeseed meal prices, and the prices may rebound moderately with fluctuations. Buyers are suggested to make proper replenishment on the dips and not to chase up prices too high.

Imported fishmeal: Imported fishmeal is quoted steadily today. Quotation at ports: it is quoted steadily at 9,000-9,200 yuan/tonne for Peruvian Standard SD with 65% protein content, 9,300-9,400 yuan/tonne for Thai SD with 67% protein content, 9,600-10,000 yuan/tonne for Japanese SD with 67% protein content, and 9,900-10,300 yuan/tonne for super SD with 68% protein content and 9,500-9,700 for old products. Stocks at port: Huangpu 128,000 tonnes, Fuzhou 37,000 tonnes, Shanghai 81,000 tonnes, Tianjin 1,000 tonnes, Dalian 14,000 tonnes, Fangchenggang 1,000 tonnes and 4,000 tonnes at other ports. FOB prices are stable from foreign merchants today: it is 1,090 USD/tonne for Peruvian Standard SD with 65% protein content and 1,290-1,310 USD/tonne for super SD with 68% protein content. Chilean Standard SD with 65% protein content is 1,100 USD/tonne, and super SD with 68% protein content at 1,300 USD/tonne. Domestic aquaculture still has slow demand for fishmeal, and due to the decreasing hog herd under the spread of the African swine fever, the consumption of in hog feed mixed with fishmeal is also restricted. Moreover, fishmeal is still piling higher at ports. These are all bearish to the market. Therefore, fishmeal price is predicted to stay stable with slight declines in the near term.

Cottonseed meal: Cottonseed meal today declines by 50-300 yuan/tonne from National Day. The environmental warning has lifted. And oil mills raise the operation rate due to the large marketing of Xinjiang cottonseed, so cottonseed meal supply is increasing. Besides, the African swine fever is spreading, and the demand is affected by narrowed price gap between soybean meal and cottonseed meal. Therefore, cottonseed meal price is depressed by all these factors above. However, U.S. soybeans prices continue to rise during the National Day. Meals on DCE today catch up after trading resumed, and spot soybean meal is up 40-70 yuan/tonne. These are positive to cottonseed meal market and may limit the declines of cottonseed oil prices. On the other hand, short-term cottonseed meal is likely to fall back continuously with the increasing operation rate, so buyers are suggested to buy on immediate demand. Additionally, China and U.S. will resume the high-level trade negotiations from Oct. 10 to 11 in Washington, and people can keep a close eye on the new development.

(USD $1=CNY 7.07)