Today (Jan. 8), 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. China and the United States are expected to sign the trade deal in a short term, for which China has committed to purchase more US agricultural products. Moreover, Brazil is forecast to harvest abundant soybean crop. These will be negative to domestic market. But port traders now have low soybean supply in hand and are in fair shipment, which still supports the market. Overall, the market for imported soybeans will probably keep range-bound in the short term. 

Cottonseed: Cottonseed price stays stable with several declines of 0.03 yuan/tonne today. The crush margin is not good. And enterprises discontinue the purchase under the impact of rain and snow in some regions, so the trading volume is limited. Besides, the delivered price arriving at factories falls due to lower freight from Xinjiang to inland. Thus, cottonseed market is dragged down. However, ginning mills reduce the operation rate, and cottonseed is in short supply, and some traders with goods in hand are reluctant to sell the cottonseed. In consequence, the supply of cottonseed in market is tight, limiting the price declines of it. And cottonseed price is expected to move sideways in the near term. Buyers can take a wait-and-see attitude.

Summary: US soybean futures fell last night on profit taking and favorable rains in South America. Oil futures open higher on Dalian Commodity Exchange today on funds buying, but then move lower to stay below the previous close. In the spot market, soybean oil increases by 20-50 yuan/tonne and palm oil partially drops by 20-30 yuan/tonne, both in tepid trading. Iran launched missile attacks against military bases housing U.S. troops. Crude oil surged by nearly 3% on escalating tensions in the Middle East. Malaysia expects palm oil production declines by 14% in December and stocks ending the year at 2.0-2.1 million tonnes, and in the meantime, it plans to launch the B20 biodiesel programme in February. China’s mills now have 1.50 million tonnes of soybean oil in outstanding contracts, and some mills still have customers waiting for picking up goods. With the support of the above bullish factors, the oil market will keep its strengthening trend. But soybean imports have been arriving at ports in huge quantity, and soybean crush has stayed at a high level in weeks. In addition, both soybean oil and palm oil stocks have increased with the end of replenishment for packing oils before the festival. These will add to fluctuations in the upward process. DCE oil futures have been narrowing down gains toward midday, so buyers with adequate stocks can wait for low and stable prices to make replenishment in small batch.

Soybean oil: GB Grade I soybean oil is mainly priced at 7160-7380 yuan/tonne in domestic coastal areas, a rise of 20-50 yuan/tonne. (Tianjin traders 7160-7170, Rizhao traders 7200, Zhangjiagang traders 7380, and Guangzhou traders 7320). 

Palm oil: RBD palm olein is mainly priced at 6620-6730yuan/tonne in coastal areas, partially down by20-30 yuan/tonne. (Tianjin traders6720-6730, down 20; Rizhao traders 6680-6690, down 30; Zhangjiagang traders 6650, flat; Guangzhou traders6620, down 40; and Xiamen yet offered). 

Imported rapeseed oil: Imported rapeseed oil steadily edges lower in price today, of which it partially settles down 10-20 yuan at 7870-8250yuan/tonne in coastal areas. (Fujian 7890; Guangdong yet offered; and Guangxi 8250.) Soybean imports have been arriving at ports in huge quantity, and due to good margins, soybean crush has stayed at a high level in weeks. In addition, both soybean oil and palm oil stocks have increased with the end of replenishment for packing oils before the festival. But there is no sign of a thaw between China and Canada, so mills now have low rapeseed crush and rapeseed oil stocks. Overall, rapeseed oil market is predicted to keep its strengthening trend, but futures move lower on profit taking in spite of higher opens, so short-term market may fluctuate to adjust. Participants can stay on the sidelines at the moment.  

Cottonseed oil: Cottonseed oil price partially rises by 50-100 yuan/tonne today. And factories offer inconsistently, so the price is negotiable. The price of cottonseed is still high. Besides, soybean oils on Dalian Commodity Exchange rise today due to the arbitrage of buying oils and selling meals, leading a rise of 20-50 yuan/tonne in spot market. Accordingly, cottonseed oil market is bolstered. But on the other hand, the market is also dragged down by limited downstream demand for cottonseed oil as blending oil and almost finished packing-oil stockpiling before the holiday. And short-term cottonseed oil market is predicted to fluctuate. Buyers can maintain appropriate inventory on the dips but not chase up prices too high.