Today (Oct. 22), the market for oilseeds and oils in China is shown as follows:

 

Imported soybean: Imported soybean price is steady with some decline today, among which Canada soybean with 41% protein drop 20 yuan/tonne from yesterday at 4000 yuan/tonne, and Ukraine soybean is unchanged from yesterday at 3470 yuan/tonne. Imported soybeans are bearish when the supply increases greatly on ample supply of China soybean, and more US soybean will be imported amid the ease of US-China trade relationship. The quotations from port traders see a decline for lack of confidence. Short-term imported soybeans for distribution are likely to be steady with weak momentum.

Cottonseed: Cottonseed prices stay stable with some rises of 0.02-0.03 yuan/kg. Oil mills start planning to stockpile cottonseed, and the trading volume increases, which may support cottonseed market. Besides, the price of Xinjiang cottonseed delivered to inland oil plants increases due to a slight rise of freight from Xinjiang to inland. But the increasing supply of cottonseed also limits price upward space. Therefore, short-term price probably rebound fractionally. Buyers can make replenishment on the dips.

Summary: US soybean futures fell last night on quickening harvest progress, as the USDA report said 46% of the soybean crop was harvested, up from 26% a week ago and above the market forecast of 42%. Oil futures ease slightly on the Dalian Commodity Exchange today. Oil spot prices also decline today, of which soybean oil and palm oil partially drop by 10-40 yuan/tonne and their trading is predicted to be less than yesterday. China is buying up on US soybeans, lifting the monthly imports to go above 8 mln tonnes in both November and December. In order to enhance soybean meal stocks and guarantee its supplies, mills have begun to pick up their operation rates since last week. Moreover, DCE crush margins for soybeans from South America and US PNW have rallied to 200-250 yuan/tonne, and there are short covering for higher import margins in Argentine soybean oil. Therefore, domestic oil market now has limited upward potential. Nevertheless, domestic soybean oil is also traded stronger than expected after the National Day holiday. Its stocks declined by 1% last week to 1.34 mln tonnes, and mills now have a backlog of contracts to be completed in November and December. Hence, short-term oil market will also not drop easily and will probably remain choppy in the wake of futures. Buyers are likely to get down to prepare for the New Year’s Day and the Spring Festival from late November, and mills now have no pressure in supply, so the oil market is predicted to maintain its strengthening trend for some time to come. DCE oil futures are backing and filling now, so buyers can wait for low and stable prices to consider about some appropriate replenishment. 

Soybean oil: GB Grade I soybean oil is mainly priced at 6,110-6,180 yuan/tonne in domestic coastal areas, partially down by 10-30 yuan/tonne. (Tianjin traders 6,110-6,120, Rizhao traders 6,130, Zhangjiagang traders 6,180, and Guangzhou traders 6,140-6,150). 

Palm oil: RBD palm olein is mainly priced at 4,780-4,940 yuan/tonne in coastal areas, down 10-50 yuan/tonne. (Tianjin traders 4,900-4,910, down 10; Rizhao traders 4,930-4,940, down 10; Zhangjiagang traders 4,880, down 40; Guangzhou traders 4,780, down 50; and Xiamen 4,850, down 30).

Imported rapeseed oil: Imported rapeseed oil declines in price today, of which it settles down 10-20 yuan/tonne at 7,280-7,400 yuan/tonne in coastal areas. (Fujian yet offered; Guangdong yet offered; and Guangxi 7,400). The demand for rapeseed oil is affected by its enlarged price gap with soybean oil and palm oil. Meanwhile, domestic oil market has adequate supplies but slack demand at present, and China is buying up on US soybeans, lifting the monthly imports to go above 8 mln tonnes in both November and December. Therefore, rapeseed oil market snaps off rises to fluctuate. But China face tight supply situation in its rapeseed market, as its pending issues with Canada can hardly be solved very soon, so rapeseed oil market still has limited downside space and may mainly fluctuate at the high level. Buyers can wait and see at the moment. 

Cottonseed oil: Cottonseed oil price stays stable with some rises of 50-100 yuan/tonne today. The trading situation after National Day is better than expected. So the cottonseed oil market is supported. However, the rises are limited by climbing operation rate and little consumption of cottonseed oil as blending oil. Moreover, oils on DCE today see stagflation and drop slightly, and spot oils see stagflation and correction. Spot soybean oil and palm oil partially drop by 10-40 yuan/tonne. Therefore, short-term cottonseed oil price may fluctuate to stay strong. Buyers can make proper replenishment on the dips and not chase up prices too high.