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

 

Imported soybean: Imported soybean price is steady with some declines today, among which Canada soybean with 41% protein is unchanged from last Saturday at 4350 yuan/tonne, Myanmar soybean is unchanged from last Saturday at 4450 yuan/tonne, and Ukraine soybean is down 310 yuan/tonne from last Saturday at 3470 yuan/tonne. China and US have reached a phase one deal and China will purchase between $40 billion and $50 billion worth of U.S. agricultural products. Trump said he would meet Chinese leader during the Asia Pacific Economic Cooperation (APEC) meetings in Nov. Amid the ease of US-China trade tension, the more US soybean imports and the marketing of China soybeans will increase the market supply. Short-term imported soybeans for distribution are likely to be steady with weak momentum.

Cottonseed: Cottonseed prices decline by 0.02-0.08 yuan/kg today. China has cut a preliminary trade deal with US, which has eased the trade war. In consequence, oil mills are less motivated to purchase cottonseed, so cottonseed price is depressed. Besides, the price of Xinjiang cottonseed delivered to inland oil mills also falls due to the lower freight from Xinjiang to inland. With the increasing supply of cottonseed, short-term cottonseed prices may mainly fall back with fluctuations, and buyers can stay on the sideline or take a hand-to-mouth purchasing strategy.

Summary: China and the U.S. reached a phase one deal which would take three to five weeks to be papered and signed, and President Donald Trump said that he would have a plan to meet Chinese leaders at the APEC summit in November. US soybeans thus closed with sharp gains last Friday. But oil futures significantly drop on the Dalian Commodity Exchange today on the trade detente. In the spot markets, soybean oil is down 50-100 yuan/tonne and palm oil down 60-120 yuan/tonne from last Friday, with trading being tepid. China will purchase $40 billion to $50 billion worth of U.S. agricultural products. The demand for soybean meal is rising on handsome margins in breeding, so mills will raise their operation rates in the next two weeks. In this case, soybean oil stocks, which is up 0.21% to 1.354 mln tonnes at present, will continue to increase. Both factors are bearish to domestic oil market, and the short-term trend may follow futures to fluctuate to drop. But soybean import cost is raised by US soybean prices which go higher due to lower stock estimates in USDA October report and the trade detente. And soybean oil traded quite well last week with a backlog of outstanding contracts. These will also help limit downside space of the oil market. Buyers can wait for low and stable prices to see if there is any need for replenishment. 

Soybean oil: GB Grade I soybean oil is mainly priced at 5,970-6,130 yuan/tonne in domestic coastal areas, down by 50-100 yuan/tonne from last Friday. (Tianjin traders 5,950-5,960, Rizhao traders 5,980, Zhangjiagang traders 6,090, and Guangzhou traders 6,020-6,050). 

Palm oil: RBD palm olein is mainly priced at 4,670-4,860 yuan/tonne in coastal areas, down 60-120 yuan/tonne. (Tianjin traders 4,790-4,800, down 80; Rizhao traders 4,860, down 60; Zhangjiagang traders 4,780, down 120; Guangzhou traders 4,670, down 110; and Xiamen yet offered).

Imported rapeseed oil: Imported rapeseed oil steps down in price today, of which it settles down 50-70 yuan/tonne at 7,300-7,400 yuan/tonne in coastal areas. (Fujian 7,300, down 50; Guangdong yet offered; and Guangxi 7,650, down 50). The demand for rapeseed oil is influenced by its remarkably higher price than soybean oil and palm oil, and domestic oil market now has adequate supplies. As a result, rapeseed oil stocks increased by 5.4% to 472,000 tonnes as of last Friday. This has dragged down its price to fluctuate to fall. But rapeseed is in tightening supply as China and Canada will less likely settle their issues very soon, which will help narrow downside space of rapeseed oil prices. The market is still digesting the bearish impact from trade spats, so buyers can wait at the moment. 

Cottonseed oil: Cottonseed oil price stays stable with several declines of 30 yuan/tonne today. Oil mills continue boosting operation rate, and the demand for oils gradually goes into an off-season, so the consumption of cottonseed oil as blending oil is limited. In addition, China has reached a preliminary trade deal with US, but it will take about five weeks to get a pact written and signed. Pres. Trump claimed to meet Chinese leaders at the APEC summit in November. Oils on DCE today drop sharply with a detente in trade war. Spot soybean oil down by 50-100 yuan/tonne and spot palm oil down by 60-120 yuan/tonne. Therefore, cottonseed oil market is dragged down by all these factors. And short-term cottonseed oil may fall back with fluctuations, so buyers can wait and see.