Today (Mar. 6), the market for oilseeds and oils in China is shown as follows:

 

Cottonseed: Cottonseed prices are partially not offered today, while some offered prices are stable with individual rises of 0.01 yuan/kg. Pastures are in rigid demand and some inland oil mills make replenishment, which offer support to cottonseed market. Due to a slight increase of freight from Xinjiang to inland, the delivered price of cottonseed in several oil mills also goes up. But the novel coronavirus pneumonia epidemic has resulted in a sharp decline in cottonseed oil. As the market is bearish on cottonseed outlook, oil mills are cautious in purchasing cottonseed, limiting the market. It is predicted that short-term cottonseed price will stay stable with fluctuations. 

Summary: Net sales of US soybeans were only 345,000 tonnes last week, which was below the market estimates and also a 35% lower than the four-week average. In addition, stock markets fell on concerns over a slowdown in global economy due to the novel coronavirus. Therefore, US soybean futures declined last night, and meal futures also drop on the Dalian Commodity Exchange today. In the spot markets, soybean oil goes down 20-80 yuan/tonne and palm oil down 70 yuan/tonne, both in thin trading. Soybean oil is still building up its stocks and mount higher to around 1.40 mln tonnes next week. Stocks have already been swelling in some mills now. On import front, crush margins for Brazilian soybeans of Mar-Jul shipments stay at a high level of 206-283 yuan/tonne, so China has bought a total of 30 cargoes of Brazilian soybeans in the first four days this week. And importers are making inquiries on US PNW of March-April shipments. Moreover, due to the widely-spreading epidemic, the demand for oils has declined significantly in the catering industry, so the oil market is under high pressure. The oil market has failed to extend the bounces for a lack of bullish fundamentals. But soybean arrivals will be smaller in March, and soybean crush will decline in these two weeks. The market has fallen from a high level to digest much bearish impact, so there will be limited space for further declines. Buyers are suggested to wait for low and stable prices to make small replenishment. 

Soybean oil: GB Grade I soybean oil is mainly priced at 5580-5800 yuan/tonne in domestic coastal areas, down 20-80 yuan/tonne and with a partial decline of 10-40 yuan/tonne. (Tianjin traders 5620; Rizhao traders 5670; Zhangjiagang traders 5800; and Guangzhou traders 5580). 

Palm oil: RBD palm olein is mainly priced at 5080-5310 yuan/tonne in coastal areas, mostly down by 60-70 yuan/tonne. (Tianjin traders 5230, down 70; Rizhao traders 5300-5310; Zhangjiagang traders 5180, down 60; Guangzhou traders 5080-5090, down 60; and Xiamen yet offered). 

Imported rapeseed oil: Imported rapeseed oil declines in price, of which it settles up 10-40 yuan at 7700-7850 yuan/tonne. (Fujian 7730, down 40; Guangdong not offered; and Guangxi not offered) As the majority of catering businesses are unable to open due to the epidemic, the demand for edible oils remains exceedingly low at present; hence, domestic oil stocks keep rising, with soybean oil stocks in particular. Besides, DCE crush margins for Brazilian soybeans are handsome, so China has bought a total of 30 cargoes this week. And imports of US soybeans and pork may also increase afterwards. Therefore, oil market declines under pressure. But domestic mills now have low rapeseed stocks amid a stalemate between China and Canada, and spot rapeseed oil has been in tight supply. Overall, rapeseed oil is more resilient than other oils, but may fluctuate to decline slightly as it is hard to buck the trend. Buyers can wait for the moment.

Cottonseed oil: Cottonseed oil is mostly unquoted today, while some offered prices keep steady. But the overall operating rate in oil plants is not high now and many oils mills in Xinjiang have outstanding contracts, which support cottonseed oil market temporarily. But catering enterprises have yet to recover, so the demand is always weak in oils market with few new orders in cottonseed oil and stocks in factories increase. Besides, oils on DCE today also stop rising and start declining. On the spot market, soybean oil down by 20-80 yuan/tonne and palm oil down by 70 yuan/tonne. Therefore, cottonseed oil prices are dampened and will likely fluctuate weakly in a short term.