Today (Oct. 25), the market for oilseeds and oils in China is shown as follows:

 

Imported soybean: Imported soybean prices are steady today, among which Canada soybeans with 41% protein are unchanged from yesterday at 3980 yuan/tonne, and Ukraine soybean is unchanged from yesterday at 3400 yuan/tonne. The ample supply of domestic soybeans affects the market of imported soybean. Moreover, the pressure from market supply will further increase as more US soybeans are expected to be purchased. Port traders are bearish on the outlook and their quotations are weak. All these are negative to domestic market. Short-term imported soybeans for distribution are likely to be steady with weak momentum.

Cottonseed: Cottonseed prices stay stable with some fluctuations of 0.01-0.03 yuan/kg. There are fewer North Xinjiang cottonseeds, and South Xinjiang cottonseeds have not gone marketing in huge quantities yet, which will support cottonseed market. But delivered price of cottonseed arriving at some oil mills falls on decreased freight from Xinjiang to Inland. But prices of staple oils and meals show a strong trend at present, especially a surge in oils prices will shore up cottonseed prices. Therefore, short-term cottonseed price is predicted to rebound with fluctuations, and buyers can make replenishment on the dips.

Summary: US soybean fell further last night, but oil futures continue to surge on the Dalian Commodity Exchange as traders are going long due to strong soybean oil trading. In the spot market, soybean oil and palm oil increase by 100-170 yuan/tonne, under which the trading may be tepid for spot contracts as most buyers have made replenishment in the past few days, but there will still be some purchases upon low-level forward basis. Soybean oil market has been robust for a seventh day and its trading hit 61,700 tonnes yesterday, of which most were forward contracts, so mills now have a backlog of contracts in November and December. Besides, buyers this year are expected to start preparation for the New Year’s Day and the Spring Festival from late November. With the push of fund, short-term oil market will maintain its firm trend. But China’s monthly soybean imports are expected to be over 8 mln tonnes in both November and December, and soybean meal stocks are quite low at present, so mills are likely to raise soybean crush to 1.85 mln tonnes next week in order to ensure supply. Moreover, DCE crush margins for soybeans from South America and US PNW have rallied to 273-288 yuan/tonne, and Argentine crude soybean oil and palm oil also bring certain import margins. Chinese importers bought 8 cargoes of palm oil with shipments in December at 578-580 USD/tonne (duty-paid price at 4,927-4,944 yuan/tonne). In view of some bearish factors and the fund-driven market this time, participants still have to strengthen risk prevention. 

Soybean oil: GB Grade I soybean oil is mainly priced at 6,320-6,450 yuan/tonne in domestic coastal areas, mostly up 100-170 yuan/tonne. (Tianjin traders 6,320-6,350, Rizhao traders 6,390, Zhangjiagang traders 6,440, and Guangzhou traders 6,450). 

Palm oil: RBD palm olein is mainly priced at 5,050-5,140 yuan/tonne in coastal areas, up 100-130 yuan/tonne. (Tianjin traders5,100-5,130, up 100; Rizhao traders yet offered; Zhangjiagang traders 5,140, up 110; Guangzhou traders 5,050-5,060, up 130; and Xiamen yet offered).

Imported rapeseed oil: Imported rapeseed oil surges in price today, of which it settles up 100-180 yuan/tonne at 7,400-7,580 yuan/tonne in coastal areas. (Fujian yet offered; Guangdong 7,260; and Guangxi 7,580, up 180). There is no sign of a thaw in relationship between China and Canada, so the tight rapeseed supply is also a support for the sharp rebound of rapeseed oil prices. But the demand for rapeseed oil is still subject to its price gap with soybean oil. And soybean imports are expected to increase significantly later to a monthly average of over 8 mln tonnes in November and December, as China and the US have reached a preliminary deal. Therefore, the upward space of rapeseed oil market may be capped by the sharp increase in rapeseed and soybean crush. Overall, the market is likely to fluctuate frequently at the high level, and buyers are suggested not to chase after excessively high prices. 

Cottonseed oil: Cottonseed oil prices increase by 50-150 yuan/tonne today. The trading situation after National Day is better than expected, so factories basically have no stock in hand. Besides, the trading volume of soybean oil continues increasing, and funds bull the market. Domestic oil futures surge continuously today, and spot soybean oil and palm oil rises by 100-170 yuan/tonne. Hence, cottonseed oil market is lifted by these factors. But on the other hand, the rises are restricted by limited consumption for cottonseed oil as blending oil. Therefore, short-term cottonseed oil price may tend to rise with fluctuations. Buyers can make proper replenishment on the dips.