Today (Jul 23), the market for meals in China is shown as follows:

Soybean meal: U.S. soybean futures rose on Wednesday on export sales to China. And the U.S. has unexpectedly requested China to close its consulate in Houston, so that participants are concerned about the implementation of the trade deal, which is bullish to domestic meal prices. Spot soybean meal prices see a rise of 10-30 CNY/tonne, still attracting some low-level purchases. Specifically, the prices sit at 2880-3020 CNY/tonne in coastal regions. (Tianjin 3020, Shandong 2960-2970, Jiangsu 2975-2950, Dongguan 2880-2900, and Guangxi 2930-2950.) Swine stocks have seen a recovery for six straight months and the aquaculture has also been in full swing now, and soybean meal takes up a bigger proportion in feed formula due to its price advantages; hence, China’s soybean meal stockpiles have been falling due to improving demand. Add to this, the U.S. move has escalated tensions with China. Therefore, some crushers and traders are stalling sales or raising sales prices in soybean meal market. However, Chinese importers ramp up soybean purchases, as crush margins for imported soybeans on the Dalian Commodity Exchange turn better. The July and August soybean arrivals at ports are forecast to hit a monthly average of over 10 mln tonnes, and domestic crushers are working at their maximum capacities. Moreover, China may sell 3-mln-tonne GM soybeans to clear storage and to make room for U.S. soybeans arriving at ports since October this year, according to market sources. An adequate supply in the market is still constraining rises in soybean meal prices. All in all, soybean meal prices will fluctuate to move higher on bullish factors, and buyers are suggested to buy appropriately on low forward basis.

Imported rapeseed meal: U.S. soybean futures rose on Wednesday as China bought US soybeans. Rapeseed meal futures on Zhengzhou Commodity Exchange fluctuate slightly. And rapeseed meal price in coastal regions settled at 2,340-2,440 CNY/tonne, with tepid trading. Rapeseed crush stays at low levels as rapeseed imports are still restricted amid tensions between Ottawa and Beijing. Besides, the tensions between U.S. and China have escalated. And US soybean condition is depending on weather, which may affect the market. Moreover, the pre-sale progress of soybean meal is good, with not many stocks left. And aquaculture has entered into a peak season, leading to an increase of soybean meal price. Thus, rapeseed meal market is boosted. Nevertheless, the monthly soybean arrival at ports is upwards of 10 mln tonnes in July and August, so soyoil mills raise the operation rate. Therefore, with bearish factors in fundamentals, rapeseed meal price is curbed and will likely fluctuate to keep strengthening in a short term.

Imported fishmeal: Imported fishmeal prices are stable with a decline 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 12,500-12,700 CNY/tonne; and Peruvian Super Prime SD with 68% protein content is 13,100-13,400 CNY/tonne, down 200 CNY/tonne from yesterday.

The demand in the aquaculture sector for fishmeal does not pick up very much, as many regions have been suffering from heavy rains in China for weeks. Moreover, the cost of importing fresh fishmeal will be lower relatively. Hence, some traders undercut to lock in profits today, which adds some bearish sentiment to domestic market. However, fresh fishmeal cargoes have not reached ports yet, and fishmeal inventories at domestic ports have fallen to 92,000 tonnes now, so traders do not intend to continue reducing prices due to small Peruvian fishmeal in stock. Overall, fishmeal market is predicted to steady with slight adjustments in the short run.

Stocks at ports: Huangpu 42,000 tonnes, Fuzhou 15,000 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.

Cottonseed meal: Cottonseed meal prices are stable with some rises of 30-50 CNY/tonne today. For the moment, factories have no pressure from inventory as the operation rate among crushing mills is low, and the cost remains high. U.S. soybean futures rose on Wednesday result from China’s continuous buying. But U.S. abruptly issued the demand to shut Chinese consulate in Houston, raising market’s concerns about the implement of trade deal. Today, spot soybean meal up by 10-30 CNY/tonne. Accordingly, all these factors boost cottonseed meal market. Besides, the crush margins of imported soybean futures have improved, spurring China to increase purchase. In July and August, the monthly arrival of soybean at ports will be past 10 mln tonnes, leading to a super high operation rate among soyoil mills. Moreover, the tensions between U.S. and China have been escalating. And markets are concerned about weather condition across soybean area. Leading by bullish factors, cottonseed meal market is likely to keep strengthening in the near term.

(USD $1=CNY ¥6.99)