Today (Apr. 28), the market for oilseeds and oils in China is shown as follows:
Oilseeds:
Imported soybean: Imported Argentine soybean is quoted slightly weaker at port today. Vessels loaded 50,000 tonnes of soybeans have arrived at Shandong port, which will add to trading supplies in the market. And China continues buying up on Brazilian soybeans due to generous crushing margins, and now it has also increased US soybean purchases. The monthly soybean arrivals at ports will be overwhelming from May to July. Due to lukewarm demand, port traders are quoted slightly lower now, which is negative to the market. Dominated by bearish factors, the market for imported soybeans is predicted to have downside potential in the short run.
Cottonseed: Cottonseed prices are stable with partial declines of 0.01-0.03 CNY/kg today. Crude oil plunged 25% on Monday, to settle at $12.78 per barrel. And U.S. confirmed coronavirus cases surpassed 1 million, which led U.S. soybeans to fall overnight. And also, bulk oils and meals futures all dropped. On the other hand, cottonseed trading is dragged down by low operation rate among inland crushing mills, so some traders slightly reduce the price. As it will take a long time before the marketing of new cottonseed, traders are in no hurry to run out stocks, limiting price declines of cottonseed. It is predicted that short-term cottonseed price may continue fluctuating.
Oils:
Summary: US soybean futures ended lower on Monday, as crude oil prices sank 25% to 12.78 USD/barrel and cases of the COVID-19 in the United States have surpassed 1 million. Oil futures pare their early gains and fluctuate to downside on the Dalian Commodity Exchange today. In the spot markets, soybean oil and palm oil partially decline by 10-30 CNY/tonnes in tepid trading. Weekly soybean oil stocks declined by 7.4% to 840,000 tonnes and palm oil down 13% to 530,000 tonnes. However, Chinese importers are still scooping up on Brazilian soybeans as gross crushing margins are high at 259-378 CNY/tonne for April to July deliveries, with a total of 40-45 shipments bought last week. And the monthly average of soybean arrivals at ports is likely to reach an overwhelming level of 9.8 mln tonnes from May to July in China, of which May arrivals are forecast to be 151 vessels with 9.87 mln tonnes. With arrivals of soybean vessels at ports, soybean crush rose 5.8% to 1.67 mln tonnes last week and is expected to reach 1.75 mln tonnes this week. The increment in soybean crush is smaller than forecast, but the uptrend seems to be unshakable. In addition, the demand in global catering services is still worrisome amid the pandemic and the demand for biofuels is also subdued by weak crude oil prices. Overall, the oil market is predicted to fluctuate with a weakening trend and will have limited upward potential even if there are bounces. Buyers can keep light stockpiles at the moment.
Soybean oil: GB Grade I soybean oil is mainly priced at 5490-5650 CNY/tonne in domestic coastal areas, a decline of 20-30 CNY/tonne. (Tianjin traders 5490; Rizhao traders 5550; Zhangjiagang traders 5650; and Guangzhou traders 5540).
Palm oil: RBD palm olein is mainly priced at 4680-4860 CNY/tonne in coastal areas, partially down by 10 CNY/tonne. (Tianjin traders 4790, down 10; Rizhao traders 4860, flat; Zhangjiagang traders 4720-4730, flat; Guangzhou traders 4680-4690,flat; and Xiamen not available).
Imported rapeseed oil: Imported rapeseed oil price rises today, of which it settles up 70-90 CNY/tonne at 6950-7150 CNY/tonne in coastal regions (Fujian 7150; Guangdong not available; and Guangxi 6950). There is no timetable as to when China and Canada will enter into a detente, so rapeseed crush in China remains low on a tight supply prospect. Oil mills have no spot rapeseed oil for sales now and are busy carrying out contracts signed previously. Rapeseed oil, soybean oil and palm oil stocks all keep declining, which gives support to the market. However, crushing margins have been quite decent for South American soybeans on the DCE, and the monthly average of soybean arrivals at ports is likely to reach an overwhelming level of 9.8 mln tonnes from May to July in China. With arrivals of soybean vessels at ports, soybean crush returned to a normal level last week and is expected to reach 1.75 mln tonnes this week. The rise in soybean crush is smaller than forecast, but the uptrend seems to be unshakable. Meanwhile, the demand in domestic catering services is still unable to be back to normal, and the demand for biofuels is also dragged down by weak crude oil prices. This may curb rise in rapeseed oil prices. Rapeseed oil market is predicted to follow futures to fluctuate in the short term and remain to be seen in the medium trend. Buyers are suggested to remain cautious in chasing after higher prices.
Cottonseed oil: Cottonseed oil price mainly keeps steady but down by 100 CNY/tonne in individual regions today. Crude oil plunged settled 25% lower at $12.78 a barrel on Monday. And U.S. confirmed coronavirus cases surpassed 1 million, which led U.S. soybeans to fall overnight. Besides, oils on Dalian Commodity Exchange fall back with fluctuations, and spot soybean oil and palm oil partly down by 10-30 CNY/tonne. With participants just being in wait-and-see mood, it is hard to reach deal in cottonseed oil market. But cottonseed is pricey due to low inventory, and the operation rate is very low among inland oil plants, so the price is stable tentatively. In addition, the demand for soybean oil obviously slows than before, and global demand in foodservices is also worrying amid the coronavirus pandemic. As a result of collapse in demand for biofuels amid gloomy crude oil, the overall market of bulk oils will still fluctuate in a weak trend. Therefore, cottonseed oil price needs to be taken with caution.
(USD $1=CNY ￥7.07)
