Today (Jul 20), the market for meals in China is shown as follows:

Soybean meal: U.S. soybean futures closed higher last Friday, and meal futures edge higher on China’s Dalian Commodity Exchange today. Spot soybean meal prices go up 10-30 CNY, attracting some low-level purchases. Specifically, the prices sit at 2850-2960 CNY/tonne in coastal regions. (Tianjin 2960, Shandong 2905-2910, Jiangsu 2860-2890, Dongguan 2850-2880, and Guangxi 2870-2900.) The demand for soybean meal keeps improving in China and its inventories have been falling for two weeks, for hog stocks go up for a sixth straight month and aquaculture is also in full swing. Moreover, domestic crushers have presold July soybean meal and tend to prop up prices. Hence, spot soybean meal prices are stronger than futures prices. However, DCE crush margins for soybeans have improved, soybean arrivals remain huge, and crushers are maintaining soybean crush at a very high level. In addition, domestic investors are increasing oil futures positions as prices are surging. Hence, soybean meal prices also have limited rises. But tensions keep escalating between China and the United States. And U.S. soybean futures could still gain support from the crop weather. And stock markets broadly go up as global monetary easing has led to an inflation expectation. Therefore, soybean meal prices will probably keep range-bound and strengthening. Buyers are suggested to keep safe stocks and buy dips appropriately.

Imported rapeseed meal: U.S. soybean futures on Friday and meal futures in China today further rose. And rapeseed meal price in coastal regions partly settled up 30-50 CNY/tonne at 2,310-2,410 CNY/tonne, with tepid trading. Both rapeseed stocks and operation rate are staying at historical lows as rapeseed imports are still restricted amid tensions between Ottawa and Beijing. Last week, rapeseed meal inventory in coastal regions declined to 23,900 tonnes with a reduction of 3.2% from the previous week. Besides, there still exist large uncertainties in weather condition across soybean area and relations between U.S. and China. Moreover, soybean meal supply gets tightened as stocks in July basically have been pre-sold, and some oil mills have sold over a half of stocks in August. Therefore, oil plants prop up price, boosting rapeseed meal market. In addition, soybean arrival at ports is upwards of 10 mln tonnes in July and August due to improved crush margins of soybean futures. In consequence, the operation rate among crushing mills remains super high, causing a consecutive increase in soybean meal stocks. Except that, the price rises of rapeseed oil futures are too excessive, so the profit taking by buying oils and selling meals will limit the growth of meal futures prices. But driven by the bullish factors in fundamentals, the overall rapeseed meal market is projected to fluctuate to keep strengthening.

Imported fishmeal: Imported fishmeal prices are stable today and can be traded through negotiation. Peruvian Standard SD with 65% protein content is 11,000-11,300 CNY/tonne; Peruvian higher-quality SD with 65% protein content is 11,500-11,700 CNY/tonne; Peruvian higher-quality SD with 67% protein content is 12,500-12,800 CNY/tonne; and Peruvian Super Prime SD with 68% protein content is 13,300-13,500 CNY/tonne.

As Peruvian fishing companies are expected to complete the the country’s 2.413-mln-tonne of anchovy quota within a week and due to disappointing sales of fresh fishmeal, local manufacturers have little intention to support prices and offered preferential prices for bulk purchases. And in China, the demand for fishmeal does not pick up very much, for rains have influenced aquaculture in most southern regions. These are constraining domestic fishmeal market. However, fishmeal inventories at ports have fallen to 93,000 tonnes in China Overall, fishmeal market is predicted to steady with slight declines in the short run. at present, so traders do not intend to continue reducing prices due to small Peruvian fishmeal in stock.

Stocks at ports: Huangpu 43,000 tonnes, Fuzhou 16,000 tonnes, Shanghai 24,000 tonnes, Tianjin 1,000 tonnes, Dalian 5,000 tonnes, Fangchenggang 1,000 tonnes and 4,000 tonnes at other ports.

FOB quotes from foreign markets today: It is quoted steadily at 1,250 USD/tonne for Peruvian Standard with 65% protein content and at 1,480 USD/tonne for Peruvian super with 68% protein content. Chilean Standard with 65% protein content is quoted at 1,290 USD/tonne, and super with 68% protein content at 1,520 USD/tonne.

Fish catches in Peru: As of July 17^th (local time), fish catches in the first season of 2020 total 2,263,738 tonnes, exhausting 93.81% of the total quota of 2.413 mln tonnes and with the fishing average at around 34,000 tonnes per day and 149,262 tonnes remaining available

Cottonseed meal: Cottonseed meal up by 20-50 CNY/tonne. For the moment, the operation rate among crushing mills is low, and the cost remains high. U.S. soybean futures further closed up on Friday. Hog inventory has increased for the sixth consecutive month and aquaculture has entered into a peak season, seeing a continuous improvement in demand for soybean meal. Besides, meal futures edges up on Dalian Commodity Exchange today, and spot soybean meal up by 10-30 CNY/tonne. Hence, cottonseed meal market is bolstered by these factors. However, soybean arrival is huge in quantity in recent months due to a distinct improvement in crush margins, so crushing mills raise the operation rate. Additionally, the demand for cottonseed meal is limited due to low cost performance, so the final price is negotiable. Furthermore, the tensions between U.S. and China have heightened, and markets are concerned about weather condition across soybean area. Leading by bullish news, cottonseed meal market is likely to keep strengthening in the near term.

(USD $1=CNY ¥6.99)