Today (Jan. 3), the market for oilseeds and oils in China is shown as follows:

 

Imported soybean: Imported soybeans steady today, among which Kazakhstan soybean is unchanged at 4,260 yuan/tonne and Canadian soybean at 4,180 yuan/tonne. Donald Trump said that the phase 1 trade deal with China would be signed on January 15th at the White House, and he would “at a later date” to start talks toward a second part of the trade deal. As a part of the trade deal, China has committed to purchase more US agricultural products. If soybean imports from the US get boosted, it will be bearish to domestic market. Overall, the market for imported soybeans will probably keep range-bound in the short term. 

Cottonseed: Cottonseed prices mostly stay stable and some fluctuate at a range of 0.02-0.05 yuan/kg. There is not much spot cottonseed, and some traders with goods in hand are reluctant to sell them. Thus, the market supply is tight, which bolsters the cottonseed market. However, the crush margin of cottonseed is poor, and some Shandong enterprises limit or discontinue production due to inspection of environmental protection. In consequence, mills are a little bit wary of purchasing cottonseed, and the trading volume is limited. Therefore, the cottonseed market is weighed down. It is predicted that the short-term cottonseed moves sideways, so buyers with inventory in hand can take a wait-and-see attitude.

Oils: 

Summary: US soybean futures continued to rise last night as China and the US would soon sign the trade deal. Palm oil futures rose by over 2% in the first session of 2020, as data showed a month-on-month decline of 21% in Malaysian production and India yesterday bought 4-60,000 tonnes of palm oil after its recent move to cut import tax. Meanwhile, the United States killed Iranian Major-General in an air strike at Baghdad airport in Iraq, which marks a dramatic escalation in the geographical crisis. In the wake of this, crude oil futures surge by nearly 2%, and oil futures also rally on the Dalian Commodity Exchange today. In the spot markets, soybean oil increases by 50-120 yuan/tonne and palm oil up by 10-50 yuan/tonne. Gains are smaller in afternoon trading on the DCE, and the spot trading is tepid after a rise in price. The oil market keeps climbing higher on speculation by funds and will probably keep its strengthening pattern. But soybean imports are substantial and its crush will stay at a very high level of over 2 mln tonnes in both the next two week. Meanwhile, buyers have almost finished the replenishment for packing oils, so that soybean oil and palm oil both see higher stocks. Moreover, the price spread for soybean oil and palm oil has shrunk sharply, which will hurt palm oil imports later. It is suggested to avoid risks of fluctuations in the upward process and buyers can wait as gains are smaller in afternoon trading on the DCE.

Soybean oil: GB Grade I soybean oil is mainly priced at 7050-7250 yuan/tonne in domestic coastal areas, a rise of 50-120 yuan/tonne. (Tianjin traders 7050-7060, Rizhao traders 7150, Zhangjiagang traders 7250, and Guangzhou traders 7210). 

Palm oil: RBD palm olein is mainly priced at 6580-6680 yuan/tonne in coastal areas, mostly up by 10-50 yuan/tonne. (Tianjin traders 6670-6680, up 50; Rizhao traders 6680, up 40; Zhangjiagang traders 6600, up 20; Guangzhou traders6580-6590, up 10; and Xiamen yet offered). 

Imported rapeseed oil: Imported rapeseed oil increases in price today, of which it settles up 30-50 yuan at 7900-8220yuan/tonne in coastal areas. (Fujian 7900; Guangdong yet offered; and Guangxi 8220.) As mills keep low operation rates for rapeseed crush amid tensions between China and Canada, rapeseed oil stocks have fallen to a low level, which has in turn bolstered the market. But soybean imports are substantial and its crush will stay at a very high level of over 2 mln tonnes in both the next two week. Meanwhile, buyers have almost finished the replenishment for packing oils, so that soybean oil and palm oil both see higher stocks. Overall, rapeseed oil market will keep strengthening, but it is necessary to avoid risks of frequent fluctuations at high levels due to smaller gains in afternoon trade. 

Cottonseed oil: Cottonseed oil price stays stable with some rises of 50-100 yuan/tonne today. Cottonseed is pricey, and some manufacturers in Shandong limit or stop production due to the inspection of environmental protection, which leads high cost and low output. Additionally, the data reveals that the production of Malaysian palm oil in December slipped by 21% month on month. And India cuts import tariff of Malaysian palm oil, boosting the market. It is reported that India bought 40,000-60,000 tonnes of palm oil yesterday, which leads palm oil futures on Bursa Malaysia Derivatives (BMD) to rise by more than 2% on the first day of 2020. Meanwhile, U.S. Military killed Iranian Major-General, in an air raid at Baghdad International Airport in Iraq. It marks a dramatic escalation in the geographical crisis, and then oil futures were up nearly 2% on the news. Besides, oil futures on Dalian Commodity Exchange (DCE) rally today. On the spot market, soybean oil up by 50-120 yuan/tonne and palm oil up by 10-50 yuan/tonne. As a result, cottonseed oil market is boosted by all these factors. But the downstream demand for cottonseed oil as blending oil is limited, which may restrict the price rises of cottonseed oil. And short-term cottonseed oil market is predicted to fluctuate. As bulk oils trimmed gains in afternoon trading, buyers can take a wait-and-see attitude.