Today (Apr. 17), the market for oilseeds and oils in China is shown as follows:

 

 

Imported soybean: The price for Argentine soybean is 4,400-4,450 yuan/tonne at port today. Soybean stocks are less than 10,000 tonnes at Shandong ports now, and domestic soybean prices still keep strengthening, both of which continue to bolster the market. However, several port traders are trying to make delivery to book profits. Besides, considerable crush margins on the DCE continue luring Chinese importers to buying up on soybeans, with a total of 6 cargoes of Brazilian soybeans bought yesterday. There will be a monthly average of nearly 10 mln tonnes of soybean vessels arriving in China from May-July. In a hybrid of the bull and the bear, the market for imported soybeans is predicted to stay stable in the short term.

 

Cottonseed: Cottonseed price keeps steady with individual declines of 0.02 yuan/kg, while it increases by 0.01 yuan/tonne on the rising freight in some regions. Both oils and meals futures drop today. And inland oil mills are passive in purchasing spot cottonseed due to a plan of shutdown to overhaul. Thus, cottonseed market is dragged down. However, there is not much cottonseed left in the market, so traders are in no hurry to run out stocks and tend to prop up price. Therefore, it is predicted that short-term cottonseed price may fluctuate to adjust.

 

 

Summary: U.S. soybean futures slid further lower on Thursday on weaker-than-expected export sales and concerns over the pandemic. Oil futures also retreat on the Dalian Commodity Exchange today. In the spot markets, soybean oil declines by 20-100 yuan/tonne and palm oil down by 10-60 yuan/tonne. Spot trading is forecast to be tepid, while there will still be decent purchases on low-level forward basis. Malaysian palm oil production saw a month-on-month increase of 25% on April 1-25. The demand for palm oil is forecast to lessen by 300,000-400,000 tonnes as Malaysia has announced to delay its implementation of B20 mandate under the shock of the coronavirus and weak crude oil prices. Hence, Malaysian palm oil on futures come under pressure. Gross crush margins for Brazilian soybeans still stay high at 279-349 yuan/tonne for for April-July delivery in China, and there will be a monthly average of nearly 10 mln tonnes of soybean vessels arriving in China from May-July. On that account, oil mills will pick up soybean crush to a normal level next week. However, soybean oil and palm oil stocks are both declining, and buyers are still waiting for picking up soybean oil in some regions. The trading is still decent on forward basis, so oil mills are propping up prices, which help reduce declines in oil prices. The market is predicted to follow futures to keep range-bound in the short run. As of April 7th, operating rates of nationwide food and beverage outlets recovered to 83%, but intraday turnover was 36.5% lower than a year earlier, according to Chinese Food Delivery Giant Meituan Dianping. In addition, US crude oil futures fell below $20 USD a barrel on Thursday, the lowest since 2002, and some crude oil prices even went negative in Canada, for sellers need to pay freight. Weak crude oil prices result in a sharp decline in the demand for biofuels, which thus affects the demand for oils. Hence, it is suggested to remain cautious about the mid-to-long trend in oil market.

 

Soybean oil: GB Grade I soybean oil is mainly priced at 5660-5880 yuan/tonne in domestic coastal areas, a decline of 20-100 yuan/tonne. (Tianjin traders 5660-5670 (DCE Y2009+160/170) for May; Rizhao traders 5880; Zhangjiagang traders 5800; and Guangzhou traders 5710-5730(DCE Y2005+120/140) for May). 

 

Palm oil: RBD palm olein is mainly priced at 4890-5120 yuan/tonne in coastal areas, mostly down 10-60 yuan/tonne. (Tianjin traders 5120, down 60; Rizhao traders not available; Zhangjiagang traders 4960, down 40; Guangzhou traders 4890-4900,down 10; and Xiamen not available). 

 

Imported rapeseed oil: Imported rapeseed oil stays stable in price today, of which it settles at 7,020-7,100 yuan/tonne in coastal regions. (Fujian 7100; Guangdong 7020, and Guangxi 7020.) Domestic rapeseed crush remains low amid tensions between China and Canada, and rapeseed oil is also in tight supply. With a lot of contracts to make delivery, oil mills mainly sign forwards contracts now. The demand for packing oil and bulk oil is not bad, so that soybean oil, palm oil and rapeseed oil stocks all keep decreasing. These factors help underpin the market. However, crush margins for South American soybeans are still decent, and the monthly soybean arrivals at ports will average 9.8 mln tonnes from May-July, so oil mills will pick up soybean crush to a normal level next week. Meanwhile, the demand in domestic catering services have not recovered to a normal level, and extremely low crude oil prices have subdued global demand for biofuels. These may weigh on rapeseed oil prices. Rapeseed oil market may follow futures to swing in the short term, but remain to be seen in mid-to-long trend. Buyers can wait for the moment.

 

Cottonseed oil: Cottonseed oil keeps steady in today, while several traders reduce the price by 50 yuan/tonne. The poor export of US soybeans, coupled with concerns of the coronavirus pandemic, caused US soybeans to decline overnight. Today, oils on Dalian Commodity Exchange (DCE) also stop rising and start falling. On the spot market, soybean oil down by 20-100 yuan/tonne and palm oil down by 10-60 yuan/tonne. Accordingly, the trade of cottonseed oil is weighed down, and some traders follow it to offer lower. But inland oil plants plan to shut down factories for an overhaul recently instead of operating as usual. Moreover, the price declines of cottonseed oil are limited by its low output and high cost as cottonseed is out of stock and pricey. Therefore, it is predicted that short-term cottonseed oil market may mainly fluctuate to adjust.