Today (Jul 1), the market for meals in China is shown as follows:

Soybean meal: U.S. soybean futures braced for sharp rises on Tuesday on the below-forecast soybean planting acreage in the USDA report. Following this, coupled with meal coverings, meal futures open high and expand gains on China’s Dalian Commodity Exchange today. Spot soybean meal go up 60-90 CNY/tonne and sit at 2730-2810 CNY/tonne in coastal regions; the trading is still better on low-level basis and tepid for spots. (Tianjin 2810, Shandong 2780-2800, Jiangsu 2730-2760, Dongguan 2730-2740, and Guangxi 2730-2750.) The cost of importing Brazilian soybeans rises as the premium stays firm amid tight supplies, so soybean crush is in dismal margins in China. And domestic demand prospect for soybean meal is positive, for hog stocks have been recovering for months. China and the U.S. are still in escalating tensions, as China has officially implemented the National Security Law and an agency in the U.S. designates Chinese tech companies HUAWEI and ZTE as national security threats. Hence, short-term soybean meal prices show noticeable rises, following the bullish USDA report. But China’s oil mills have been working at full capacity under huge soybean imports, and now some of them have to suspend production due to swelling soybean meal inventories. Oil mills are trying to speed up delivery, but the demand from meat and aquatic industry is still affected by the coronavirus pandemic. Domestic fundamentals are still bearish, which may add to fluctuations in the market. Buyers are suggested to buy on dips for appropriate replenishment, but not to chases those with excessive rises.

Imported rapeseed meal: U.S. planted area and quarterly inventory of soybean are both lower than expected, according to the report released by USDA. U.S. soybean futures and domestic meals futures surged on the news. Rapeseed meal price in coastal regions settled up 30-50 CNY/tonne at 2,260-2,350, seeing light trading. The imports of rapeseed are still disrupted amid tensions between Ottawa and Beijing. Accordingly, both rapeseed crush and inventories among crushing mill are staying at historic lows. And there still exists uncertainties in China-U.S. relations. Therefore, rapeseed meal market is boosted by these factors. But monthly soybean arrivals at ports between June and August are upwards of 10 mln tonnes, the operation rate among crushing mills remains super high. Based on this, soybean meal stocks in coastal areas consecutively climb up. In addition, the second wave of COVID-19 outbreak in Beijing may hit demand for meats and aquatic products. Consequently, the price rises of rapeseed meal is limited under the bearish fundamentals. FYI, buyers who have replenished stock had better not chase up price too high.

Imported fishmeal:  Imported fishmeal prices stay stable today and can be traded through negotiation. Peruvian Standard SD with 65% protein content is 11,500 CNY/tonne; Peruvian higher-quality SD with 65% protein content is 11,900-12,000 CNY/tonne; Peruvian higher-quality SD with 67% protein content is 12,700-12,900 CNY/tonne; and Peruvian Super Prime SD with 68% protein content is 13,600-13,800 CNY/tonne.

China’s fishmeal stocks are not in huge quantities at present, which helps support the prices. However, domestic demand for fishmeal does not pick up very much now, as recent rains have slowed down aquaculture activities in the southern parts, so that most feed plants do not make bulk purchases. The demand now is weighing on domestic fishmeal market. Meanwhile, as fish catches go along at a brisk pace in Peru, local manufacturers have also reduced their quotes today. The decline in the cost of imports have also dented Chinese port traders’ willingness to prop up prices.

Stocks at port: Huangpu 51,000 tonnes, Fuzhou 13,000 tonnes, Shanghai 29,000 tonnes, Tianjin 1,000 tonnes, Dalian 7,000 tonnes, Fangchenggang 1,000 tonnes and 4,000 tonnes at other ports.

FOB quotes from foreign markets today: It is quoted lower by 50 USD at 1,250 USD/tonne for Peruvian Standard with 65% protein content and lower by 50 USD at 1,480 USD/tonne for Peruvian super with 68% protein content. Chilean Standard with 65% protein content is quoted steadily at 1,390 USD/tonne, and super with 68% protein content at 1,620 USD/tonne.

Fish catches in Peru: As of June 29^th (local time), fish catches in the first season of 2020 total 1,818,587 tonnes, taking up 75.37% of the total quota of 2.413 mln tonnes and with the fishing average at around 38, 000 tonnes per day and 594,413 tonnes remaining available.

Cottonseed meal: Cottonseed meal prices keep steady and rise in several regions today. It posted a surge in U.S. soybean on the bullish report by USDA. Meals on Dalian Commodity Exchange go up after high opens today result from a profit taking by buying meals and selling oils, and spot soybean meal up by 60-90 CNY/tonne. Besides, some traders still prop up price due to cottonseed shortage, boosting cottonseed meal price to increase. As soybean arrival at ports is huge in quantity between June and August, the operation rate among crushing mills remains super high, and some oil plants have halted the operation due to a stock overage. Additionally, a second wave of COVID-19 in Beijing impact demand for meats and aquatic products. Therefore, cottonseed meal price is curbed and will probably fluctuate at a narrow range in a short term.

(USD $1=CNY ¥7.07)