Today (Jan. 14), 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 to sign thephase-1 trade deal this week, and the U.S. Treasury Department dropped its designation of China as a currency manipulator. China’s soybean imports from the US may get increased in the near future. Moreover, Brazil is forecast to harvest abundant soybean crop, which is negative to domestic market. But port traders now have low soybean supply in hand, which still supports the market. Overall, the market for imported soybeans will probably be little changed ahead of the Spring Festival. 

Cottonseed: Cottonseed prices stay stable today. Cottonseed supply is less under the impact of low operation rate and some oil mills stock up cottonseed to ensure the operation after Spring Festival, for which the cottonseed market is bolstered. However, the crush margin of cottonseed is poor, and inland enterprises halt the operation and have a holiday successively with Spring Festival approaching. In consequence, the trading volume is limited, and the cottonseed market is weighed down. It is predicted that the short-term cottonseed moves sideways, so buyers can take a wait-and-see attitude.

Summary: US soybean futures declined last night on technical selling and bumper crop production outlook in Brazil where dryness was lessened by favorable rains. However, China and the United States will sign the phase-1 trade deal this week and the U.S. Treasury Department dropped its designation of China as a currency manipulator. The cost of import is lowered down as CNY hits 6.9. Meanwhile, the Indian government has urged importers to boycott Malaysian palm oil following a political spat. Therefore, oil futures broadly drop on the Dalian Commodity Exchange today, led by palm oil. In the spot markets, soybean oil declines by 40-80 yuan/tonne and palm oil down by 60-170 yuan/tonne, and the trading is tepid as buyers are awaiting. Funds significantly trim positions, so that oil futures are under pressure both at home and abroad. And due to favorable weather in production regions, palm oil production will get improved. Palm oil production in Malaysia only declined by 1.5% month on month in the first 10 days of this month, far lower than a decrease of 29% in the first 5 days, according to a report by SPPOMA. In addition, soybean crush is also pegged at a high level. DCE oil futures thus fall, and the spot market also goes into the correction territory in the short term. But with many bullish fundamentals, the oil market will probably maintain its strong pattern. Buyers can wait for low and stable prices to replenish in small batch.

Soybean oil: GB Grade I soybean oil is mainly priced at 7100-7290 yuan/tonne in domestic coastal areas, a decline of 40-80 yuan/tonne. (Tianjin traders 7100-7110, Rizhao traders 7170, Zhangjiagang traders 7280, and Guangzhou traders 7290). 

Palm oil: RBD palm olein is mainly priced at 6590-6720 yuan/tonne in coastal areas, a decline of 60-170 yuan/tonne. (Tianjin traders 6670-6680, down 110; Rizhao traders 6720, down 60; Zhangjiagang traders 6600, down 170; Guangzhou traders 6590, down 100; and Xiamen yet offered). 

Imported rapeseed oil: Imported rapeseed oil drops in price today, of which it settles down 20-30 yuan at 7970-8300yuan/tonne in coastal areas. (Fujian 8090; Guangdong yet offered; and Guangxi yet offered.)US soybean futures closed with losses last night on favorable rains which would raise expectations for bumper crop in Brazil. And China and the United States will sign the phase-1 trade deal this week, and the U.S. Treasury Department dropped its designation of China as a currency manipulator. The cost of import gets lower as CNY hits 6.9, which is negative to domestic oil market. Meanwhile, Indiahas suspended imports of Malaysian palm oil following a political spat, which weighs down palm oil futures. Therefore, oil futures all fall broadly in China today. But as there is still no sign of a thaw China and Canada, rapeseed and rapeseed oil stocks are at low levels among mills. Overall, rapeseed oil market will keep its strengthening trend, but will follow futures to fluctuate in the short term. Buyers can wait at the moment.

Cottonseed oil: Cottonseed oil stays stable today. Cottonseed is pricey and cottonseed oil is out of stock in most factories, supporting cottonseed oil market. Moreover, inland oil mills successively halt the operation and have a holiday, so operation rate is in a downward tendency. But the downstream demand for cottonseed oil as blending oil is limited. Additionally, oils on DCE today show a wide range of falls, and palm oil leads the decline. On the spot market, soybean oil down by 40-80 yuan/tonne and palm oil dip by 60-170 yuan/tonne. Thus, these factors drag down cottonseed oil market. Thus, short-term cottonseed oil market is predicted to fluctuate in a steady pace. Bulk oils pare gains, so buyers can maintain a wait-and-see attitude.