Today (Jun 24), the market for oilseeds and oils in China is shown as follows:

Oilseeds:

Imported soybean: PNW soybeans are quoted higher by 20 CNY at 4070-4080 CNY/tonne and Brazilian soybeans lower by 50 CNY at 3450-3500 CNY/tonne at Shandong ports, which are also the delivery points. Domestic soybean prices are at a high level, and PNW soybean supply is highly concentrated at ports, both of which bolster its prices to increase. But Brazilian soybeans are in huge supply and of very different qualities. In addition, some soybean cargoes from Argentina are unloading at domestic ports, and some vessels from Uruguay are also expected to arrive soon. Hence, port stocks will get an increase. On the demand front, buyers are not vigorous, which also slows down port shipments. Overall, imported soybean market is predicted to trade at a narrow range in the short term.

Cottonseed: Cottonseed meal prices keep steady today. U.S. soybean futures ended lower on Tuesday as nice weather boosted an expectation of bumper harvest. Meals on Dalian Commodity Exchange continue falling back today, and spot soybean meal steadily down by 10-30 CNY/tonne. For soybean arrival at ports is huge in quantity between June and August, soybean crush remains a fresh record high of 2.15 mln tonnes per week. And soybean meal stocks in coastal regions have increased to 900,000 tonnes, an advance of 20% from the previous week. Such being the case, some oil plants halt the operation due to a stock overage, and buyers are wary of jumping into the market. Moreover, the demand for cottonseed meal is restricted due to the low cost performance. Thus, cottonseed meal price is curbed by these factors. Nevertheless, cottonseed price is still high, so cottonseed meal market will not drop too much and likely fluctuate at a narrow range in the near term.

Oils: 

Summary: U.S. soybean futures fell on Tuesday as favorable weather improved the potential for high yields, and oil futures swing to decline on China’s Dalian Commodity Exchange today. In the spot markets, soybean oil and palm oil partially go down by 10-30 CNY/tonne in tepid trading. With huge soybean arrivals and on concerns over the storage in the scorching summer, Chinese oil mills are seeking to work at full capacity. China’s weekly soybean crush rose by 4% to a new high of 2.14 mln tonnes last week, and is expected to stay at 2.15 mln tonnes in the coming two weeks. And soybean oil stocks thus increased by 8.5% weekly to 1.04 mln tonnes. Meanwhile, domestic palm oil stockpiles also start to increase to over 400,000 tonnes last week as more vessels were arriving at ports. And rapeseed and rapeseed oil imports also got an increase last week. However, imported soybean crush is not lucrative in China now if by DEC meal and oil prices. And U.S. soybean crops are in the stage of growth, which could easily trigger weather speculation in the market. Besides, uncertainty remains in relations between China and the United States. Overall, short-term oil market is predicted to follow futures to swing to adjust, with little downside space, and to maintain a strengthening trend. DCE oil futures are in the correction, so buyers can wait for the moment.

Soybean oil: GB Grade I soybean oil is mainly priced at 5800-5970 CNY/tonne in domestic coastal areas, partially down by 10-20 CNY/tonne. (Tianjin traders 5840-5850; Rizhao traders 5800; Zhangjiagang traders 5950; and Guangzhou traders 5950-5970). 

Palm oil: RBD palm olein is mainly priced at 5410-5510 CNY/tonne in coastal areas, down 10-30 CNY/tonne. (Tianjin traders 5440-5460, down 10; Rizhao traders 5500-5510, flat; Zhangjiagang traders 5410-5420, flat; Guangzhou traders 5450-5470, down 10; and Xiamen not available). 

Rapeseed oil: U.S. soybean futures fell on Tuesday as favorable weather improved the potential for high yields, but rapeseed oil futures extend gains on China’s Zhengzhou Commodity Exchange today on tight supplies.  Spot rapeseed oil prices go up 10-20 CNY/tonne to 7860-7930 CNY/tonne in tepid trading. China’s palm oil stockpiles have been around a low level as domestic selling prices are lower than the cost of imports, and rapeseed oil inventories keep tightening as rapeseed crush has declined obviously when its imports get disrupted amid tensions between China and Canada. However, domestic oil mills further picked up soybean crush to a historical high level of 2.14 mln tonnes last week due to huge soybean arrivals between June and August, so that soybean oil stocks also rose by 8.5% to 1.04 mln tonnes. Palm oil stocks also start to show a sign of growth. Overall, rapeseed oil prices will probably stay at a high level in the short run, but the trading is predicted to be thin.

Cottonseed oil: Cottonseed oil prices today are firm. Cottonseed is pricey and in tight supply in Xinjiang, so oil factories are in no hurry to sell cottonseed oil. These factors are offering support to cottonseed oil market. But soybean arrivals at ports are huge in quantity, and soybeans are easily damaged under the hot weather, so crushing plants are operating as usual as possible. Last week, soybean crush set to a record high of 2.14 mln tonnes with a rise of 4% from a week earlier, and soybean oil stocks increased by 8.5% to 1.04 mln tonnes compared with the previous week. Besides, U.S. soybeans have been planted 96%, higher than 83% in the corresponding period last year and a five-year average of 93%. Additionally, U.S. soybean futures went down on Tuesday as nice weather boosted an expectation of bumper harvest. Today, oils on Dalian Commodity Exchange fluctuate to fall back. Soybean oil and palm oil partly decline by 10-30 CNY/tonne in the spot market. In this case, all these factors are bearish for cottonseed oil market. It is predicted that cottonseed oil market may move sideways in a short term, but will likely follow bulk oils to fluctuate to stay strong on the whole.

(USD $1=CNY ¥7.06)