Today (May 28), the market for meals in China is shown as follows:
Soybean meal: U.S. soybean futures closed further higher on Wednesday, but meal futures opened high but then move lower on the Dalian Commodity Exchange today. Spot soybean meal fluctuates by 10-20 CNY/tonne with some low-level purchases. The price settles at 2640-2780 CNY/tonne in coastal regions. (Tianjin 2780, Shandong 2755-2770, Jiangsu 2700-2720, Dongguan 2640-2690, and Guangxi 2640-2660.) Traders now focus more on the outside markets. Meng Wanzhou lost bid to end extradition procedure, according to an announcement by a Canadian court on Wednesday. The souring relations between China and Canada will continue exerting an influence on canola exports, which is now bullish to domestic meal prices. And previously, US President Donald Trump suggested that his administration would impose sanctions on China this week in response to China's deliberation on Hong Kong-related national security legislation, and China said that it would take all necessary measures to hit back; at this point, tensions get escalating again between the two nations, and the offshore exchange rate of CNY keep decreasing, which lifts cost of soybean imports. Moreover, soybean meal market was hot yesterday and its trading totaled 1.11 mln tonnes to hit a single-day record this year. These together support meal prices to keep range-bound and rebound. However, soybean meal stocks have been rising rapidly in coastal regions due to huge soybean imports and high soybean crush. This bearish fundamental is still curbing the rise in soybean meal prices and adding fluctuations to the market. Participants need to keep balance of buying and selling, and buyers with adequate stocks can wait for low and stable prices to make appropriate replenishment.
Imported rapeseed meal: U.S. soybean futures closed higher yesterday. Huawei Technologies Co’s CFO Meng Wanzhou was dealt a setback by a Canadian court on Wednesday, and she would stay in Canada to attend later hearing. This deteriorated relations between Ottawa and Beijing, which led rapeseed meal futures on Zhengzhou Commodity Exchange to rebound. And imported rapeseed meal price in coastal areas settles up 10-30 CNY/tonne at 2,250-2,370 CNY/tonne with tepid trading. Accordingly, rapeseed import is blocked amid tensions between Canada-China and Australia-China. In addition, U.S. President Donald Trump claimed to sanction China over Chinese national security legislation on Hong Kong before the weekend, while China declared to take counter measures, inflaming tensions between U.S. and China. In this case, the exchange rate of CNY plunged, which pushed up cost for importing soybean. Thus, rapeseed meal price was boosted to maintain a rebound trend. And rapeseed meal stocks in coastal areas continued increasing last week, and it would see a huge arrival of soybean from May to August, leading to a consecutive rise in soybean meal stocks. Likewise, the demand for meats has been greatly impacted by the coronavirus pandemic, so downstream enterprises are still wary of taking purchase. As there are only few orders in rapeseed meal, the price rises will be curbed.
Imported fishmeal: Imported fishmeal prices are marginally lower today and can be traded through negotiation. Peruvian Standard SD with 65% protein content is 11,300-11,500 CNY/tonne, down 100-400 CNY/tonne; Peruvian higher-quality SD with 65% protein content is 11,600-11,800 CNY/tonne, down 100-400 CNY/tonne; Peruvian higher-quality SD with 67% protein content is 12,400-12,700 CNY/tonne, down 100-300 CNY/tonne; and Peruvian Super Prime SD with 68% protein content is 13,400-13,700 CNY/tonne, down 100-300 CNY/tonne. Domestic feed plants are cautious in purchasing due to tepid demand and as fishmeal prices have been at high levels, and fish catches show a good picture in Peru; hence, some domestic fishmeal enterprises turn bearish and also loosen their prices in signing deals. In the short run, fishmeal market is predicted to stay stable with some slight declines. Stocks at port: Huangpu 59,000 tonnes, Fuzhou 21,000 tonnes, Shanghai 37,000 tonnes, Tianjin 1,000 tonnes, Dalian 10,000 tonnes, Fangchenggang 1,000 tonnes and 4,000 tonnes at other ports. FOB quotes from foreign markets today: It is quoted steadily at 1,500 USD/tonne for Peruvian Standard with 65% protein content and at 1,730 USD/tonne for Peruvian super with 68% protein content. Chilean Standard with 65% protein content is quoted steadily at 1,490 USD/tonne, and super with 68% protein content at 1,720 USD/tonne.
Cottonseed meal: Cottonseed meal prices keep steady and up by 20-100 CNY/tonne in some regions today. Huawei Technologies Co’s Chief Financial Officer Meng Wanzhou was dealt a setback by a Canadian court on Wednesday, which heightened tensions between China and Canada. Consequently, Canadian rapeseed imports will be affected, bulling meals price. Besides, U.S. President Donald Trump claimed to sanction China over Chinese national security legislation on Hong Kong before the weekend, while China declared to take counter measures, inflaming tensions between U.S. and China. In this case, the exchange rate of CNY plunged, which pushed up cost for importing soybean, thereby causing a rise in meals price. Besides, cottonseed price remains high, and most of mills in Xinjiang have no inventory of cottonseed meal. Therefore, cottonseed meal market is buoyed to rebound. However, a huge arrival of imported soybean coupled with super high operation rate lead to a sharp rise in soybean meal stocks in coastal regions. Also, the price of cottonseed meal has surpassed soybean meal, and the demand for cottonseed meal is limited due to low cost performance. It is predicted that short-term cottonseed meal price may fluctuate to rebound moderately.
(USD $1=CNY ￥7.13)
