Today (Dec. 18), the market for oilseeds and oils in China is shown as follows:

 

Imported soybean: Imported soybeans are stable today, among which Kazakhstan soybean is unchanged at 4,300 yuan/tonne. Imported soybean supply to distribution markets remains scanty at ports and traders are in fair shipments, which is good to the market. However, China will substantially increase agricultural products imports like soybeans from the US after the trade deal is signed, which will be negative to domestic market. Traders are staying on the sidelines with a hybrid of the bull and the bear, and the market for imported soybeans will probably keep steady in the short term. 

Cottonseed: Cottonseed prices stay stable with some rises of 0.01-0.06 yuan/kg. There is not much spot cottonseed available for sale on the market and the supply is tight. Besides, the freight from Xinjiang to inland remains high for a shortage of vehicles. Thus, these factors bolster the cottonseed market. However, factories have little shipping quantity of cottonseed oil and cottonseed meal. Meanwhile, China and U.S. have agreed on the text of phase one trade deal, which will sharply increase import of U.S. agricultural products. And oil mills are a little bit wary of purchasing cottonseed, and the trading volume is limited. Therefore, the price rises of cottonseed are curbed by these factors. It is predicted that the overall cottonseed will continue trending up with fluctuations. Buyers can maintain appropriate inventory on the dips but not chase up prices too high.

Summary: US soybean rose further on hopes for rising exports bolstered by a trade deal between China and the US. But on the Dalian Commodity Exchange today, soybean oil slows down its gains and palm oil fluctuates to fall on profit taking. In the spot markets, soybean oil stops rising to steady and palm oil drops by 10-40 yuan/tonne. Buyers are staying on the sidelines and make few purchases. China will substantially boost imports of agricultural commodities like soybeans from the US after signing the trade deal. Meanwhile, due to good crush margins for imported soybeans on the DCE and low soybean meal stocks, mills will pick up crush to 1.80 mln tonnes both in the next two weeks. These factors are bearish and will add to fluctuations in oil market in its upward trend. But soybean import cost is boosted by consecutive rises in US soybeans. Meanwhile, mills are in smooth delivery with festival demand underway, so soybean oil stocks fell further to around 950,000 tonnes as of last Friday, and buyers still need to queue up for picking up goods in some areas. Besides, funds are still speculating on the estimates for a production reduction in palm oil in Southeast Asia. Overall, oil market is predicted to keep its strengthening trend, but is likely to suffer some fluctuations and corrections in the short term. Buyers can wait at the moment.

Soybean oil: GB Grade I soybean oil is mainly priced at 6,790-7,000 yuan/tonne in domestic coastal areas, a partial rise of 20 yuan/tonne. (Tianjin traders 6,790-6,800, Rizhao traders 6,900, Zhangjiagang traders 6,950, and Guangzhou mills 7,000 and traders 6,860-6,880). 

Palm oil: RBD palm olein is mainly priced at 6,080-6,260 yuan/tonne in coastal areas, down 10-40 yuan/tonne. (Tianjin traders 6,230-6,240, down 10; Rizhao traders 6,180-6,190, down 40; Zhangjiagang traders 6,250, down 10; Guangzhou traders 6,080, down 10; and Xiamen yet offered). 

Imported rapeseed oil: Imported rapeseed oil goes up in price today, of which it settles up 50-70 yuan at 7,680-7,950 yuan/tonne in coastal areas. (Fujian 7,680, up 50; Guangdong yet offered; and Guangxi 7,950.) Rapeseed is in tight supply as China and Canada are less likely to address their issues very soon, so mills have to keep low operation rates, which has boosted rapeseed oil market. But China will substantially increase agricultural products imports like soybeans from the US after the trade deal is signed, and mills will raise soybean crush over 1.80 mln tonnes both in the next two weeks due to good crush margins for imported soybeans on the DCE. Overall, rapeseed oil market is predicted to keep strengthening and to fluctuate frequently on the back of futures in the short term.

Cottonseed oil: Cottonseed oil price stays stable with some rises of 100-150 yuan/tonne today. The price of cottonseed remains high, and soybean oil on Dalian Commodity Exchange today keeps rising. Hence, cottonseed oil market is bolstered. Due to the limited downstream demand for cottonseed oil as blending oil, there are not many actual transactions of some manufacturers, which will lead cottonseed oil to yet to up extensively. It is expected that short-term cottonseed oil may keep strong with fluctuations. Buyers can maintain appropriate inventory on the dips but not chase up prices too high.