Today (Aug 6), the market for meals in China is shown as follows:

Soybean meal: U.S. soybean futures closed further lower on Wednesday, and meal futures open lower to fall on China’s Dalian Commodity Exchange today. Spot soybean meal prices go down 10-40 CNY/tonne to 2,850-2,950 CNY/tonne in coastal regions, and the trading is thin. (Tianjin 2950, Shandong 2910-2950, Jiangsu 2880-2910, Dongguan 2850-2900, and Guangxi 2880-2900.) China’s soybean arrivals will surpass 10 million tonnes in August and crushing plants are maintaining extremely high operation rates, which are both potentially bearish to the market. Moreover, weather conditions are favorable in the U.S. soybean producing regions, bolstering crop rating, flowering and pod setting well above this time last year and the five-year average. The crop is expected to set a new record yield of 54 bu/acre and the USDA will likely hike estimates for soybean production in its August report. Nevertheless, there is strong demand for soybean meal in China now, as the demand for hog feed is increasing and soybean meal has a higher value-to-price ratio than alternative meals. Soybean meal inventories have thus been reducing in spite of high soybean crush, with a 2% weekly decline to 860,000 tonnes. In addition, many crushers have sold out August soybean meal and completed some forward sales, so that they are mainly carrying out contracts now. On the whole, soybean meal market is predicted to have limited downside space in the near term, and buyers can wait for low and stable prices to make appropriate replenishment.

Imported rapeseed meal: US soybean yield is expected to set a historical record. US soybean futures further declined on Wednesday on the news. And rapeseed meal futures on Zhengzhou Commodity Exchange fluctuate slightly today. Rapeseed meal price in coastal regions settled at 2,260-2,330 CNY/tonne, with tepid trading. Besides, rapeseed crush stays at low levels due to limited rapeseed imports amid tensions between China and Canada. Moreover, aquaculture has entered into a peak season and breeding industry is also recovering gradually. In this case, soybean meal stocks in crushing mills fall for the four week in a row. On the other hand, people still have fears about the rising tensions between the US and China, and US soybean market is still driven by weather condition. Accordingly, the overall soybean meal market keeps strengthening, which boosts rapeseed meal price. But soybean arrival at ports will past 10 mln tonnes in August, leading to a super high operation rate. Therefore, rapeseed meal price is still depressed by bearish fundamentals and will likely fluctuate in a short term.

Imported fishmeal: Imported fishmeal prices are stable today and can be traded through negotiation. Peruvian Standard SD with 65% protein content is 10,800-11,100 CNY/tonne; Peruvian higher-quality SD with 65% protein content is 11,400-11,500 CNY/tonne; Peruvian higher-quality SD with 67% protein content is 12,400-12,500 CNY/tonne; and Peruvian Super Prime SD with 68% protein content is 13,000-13,100 CNY/tonne. The cost of producing feed has fractionally risen in China since the policy of forbidding antibiotic additives in feed took effect. Moreover, corn prices have been on an uptrend for months in China, which also bolsters other feedstuff prices to increase. Given this, some aquatic feed producers have raised their prices recently, so that fishmeal prices have become more resilient. Moreover, the demand for fishmeal is improving, as aquaculture is recover with favorable weather. But fresh fishmeal of lower cost from Peru are arriving at domestic port, which is adding some bearish sentiment to the market. Overall, domestic fishmeal prices are predicted to steady with a weakening trend in the near term.

Stocks at ports: Huangpu 44,000 tonnes, Fuzhou 15,000 tonnes, Shanghai 27,000 tonnes, Tianjin 1,000 tonnes, Dalian 6,000 tonnes, Fangchenggang 1,000 tonnes and 4,000 tonnes at other ports.

FOB quotes from foreign markets today: Sept/Oct shipments are quoted steadily at 1,200 USD/tonne for Peruvian Standard with 65% protein content and at 1,430 USD/tonne for Peruvian super with 68% protein content. Chilean Standard with 65% protein content is quoted at 1,220 USD/tonne, and super with 68% protein content at 1,450 USD/tonne.

Cottonseed meal: Cottonseed meal prices keep steady today. Cottonseed is pricey and factories have no pressure from inventory, bolstering cottonseed meal market. But the huge imports of soybean, coupled with high crush still carry the potential to bear the market. U.S. soybean futures closed down on Wednesday. And meal futures on Dalian Commodity Exchange fell back after low opens today, and spot soybean meal dropped by 10-40 CNY/tonnes in coastal regions. Moreover, the demand for cottonseed meal is limited due to lower cost performance compared to soybean meal. Thus, these have dampened cottonseed meal price. It is predicted that short-term cottonseed meal price will fluctuate at a narrow range. But over the concerns about U.S.-China tensions and growing demand in breeding, cottonseed meal market still maintain a strong trend overall.

(USD $1=CNY ¥6.94)