According to Cofeed, in the week as of May 1, details of soybean oil inventories and outstanding contracts in main domestic regions are as follows:
Soybean oil stocks continue declining this week, but the decline is obviously smaller. In the week ending May 1, China’s commercial inventory has totaled 812,150 tonnes, down 25,500 tonnes by 3.04% from 837,650 tonnes last week, down 367,850 tonnes by 31.17% from 1,180,000 tonnes last month, and down 583,050 tonnes by 41.79% from 1,395,200 tonnes of the corresponding period last year. And the five-year average at the same period is 1,058,000 tonnes.
Oil mills have resumed normal operation rates this week (Apr 25-May 1) due o decent crush margins, some of which have even worked at full capacity. Soybean crush at domestic mills totals 1,777,000 tonnes (meal 1,403,830 tonnes and oil 337,630 tonnes), up 102,100 tonnes or 6.10% from 1,674,900 tonnes in the previous week. Meanwhile, operation rates (capacity utilization) are 51.18%, up 2.9% from 48.24% in the previous week. With huge soybean cargoes arriving at ports, the crush will continue to rise to around 1.82mln tonnes and 1.98 mln tonnes in the next two weeks, respectively. Hence, soybean oil stocks are expected to rally alongside rising operation rates.
Fig.: China’s Soybean Oil Stocks in Recent Years
