Today (Aug 11), the market for oilseeds and oils in China is shown as follows:

Oilseeds:

Imported soybean: The reference price is 3,620 CNY for Brazilian soybeans and 3,750-3,790 CNY/tonne for Argentine soybeans at Shandong ports, and 4,800 CNY/tonne for non-GM Ukrainian soybeans at Tianjin port. Soybean is in thin trade at ports in China during the seasonally slack demand, so that shipments are also at a slow pace. And soybean vessels are reaching domestic ports gradually. Both are cracking down on traders’ confidence. However, the supply of imported soybeans is relatively limited at Shandong ports now that traders there are controlling the quantity in circulation, which may reduce the price declines. In a hybrid of the bull and the bear, imported soybean market is predicted to steady with a weakening trend in the short run.

Cottonseed: Cottonseed prices today steadily decline by 0.04 CNY/kg. The trading in cotton by-products gets worse as bulk oils pare gains. Moreover, cottonseed oil mills are not active in buying cottonseed due to a high price, which weighs on cottonseed market. But cottonseed is in short supply as a whole. Besides, many places in Xinjiang have been locked down due to the COVID-19 outbreak, so it is lack of vehicles from Xinjiang to inland, increasing the transport cost. These are supporting cottonseed market. As oils and meals prices fall back, cottonseed market turns to stagnate with fluctuations. And short-term market will be resilient on account of cottonseed shortages. After new cottonseed intensively enters market, the price will probably fall back from high levels.

Oils: 

Summary: U.S. soybean futures rose on strong export sales on Monday, and on the Dalian Commodity Exchange today, soybean oil posts slight gains after wide declines yesterday and palm olein lingers around the previous close. The MPOB monthly report yesterday is a bearish factor to palm olein on the DCE. In the spot markets, soybean oil goes up 20-70 CNY/tonne and palm oil down 10-50 CNY/tonne, both in tepid trade. The overall fundamentals are satisfactory in the oils market at present. Although soybean crush remained high at 2.04 mln tonnes last week, soybean oil stocks fell 0.3% weekly to 1.243 mln tonnes and its amount in outstanding contracts surged 6% weekly to 2.553 mln tonnes. Moreover, mid-to-downstrem buyers are stocking up packaging oils. Meanwhile, domestic palm oil stockpiles are also low, though they rose 22% to 354,000 tonnes last week. And rapeseed oil inventories are also at a low level. Besides, China and the U.S. are still in souring tensions. These are all supporting the oils market, so that the oil market slowed down declines this morning. But there is a lack of fresh cues in fundamentals and the market forecasts that the USDA will raise its estimates for soybean yield in the report, so the oil market was difficult to climb further and again test the lower point in afternoon trade. Participants need to remain cautious.

Soybean oil: GB Grade I soybean oil is mainly priced at 6,410-6,520 CNY/tonne in domestic coastal areas, up 20-70 CNY/tonne. (Tianjin traders 6410-6420; Rizhao traders 6450; Zhangjiagang traders 6520; and Guangzhou traders 6500-6520). 

Palm oil: RBD palm olein is mainly priced at 6,010-6,120 CNY/tonne in coastal areas, mostly down 10-50 CNY/tonne. (Tianjin traders 6010-6020, down 10; Rizhao 6120, down 50; Zhangjiagang traders 6040, down 10; Guangzhou traders 6070-6090, flat; and Xiamen not available). 

Rapeseed oil: U.S. soybean futures closed higher on Monday, but rapeseed oil futures extend losses on Zhengzhou Commodity Exchange today. Spot rapeseed oil prices are offered lower by 10-20 CNY at 9,010-9,080 CNY/tonne in coastal regions in tepid trading. China’s soybean arrivals are forecast to hit 10 mln tonnes in August, and huge soybean supplies will keep the crush high at 2.05 mln tonnes this week and 2.08 mln tonnes next week. And the consumption of rapeseed oil is small because of its widening price spread with rivals soybean oil and palm oil. But China’s rapeseed crush stays at a low level, as its rapeseed imports are limited amid tensions with Canada.  And rapeseed oil and palm oil inventories are both low compared to this period in record. In addition, China and the US are still in tensions. Rapeseed oil futures expand losses in afternoon trade, so buyers can stay on the sidelines for the moment.

Cottonseed oil: Cottonseed oil prices stay firmly today. Cottonseed price is too high and manufacturers have no pressure from inventory. U.S. soybean futures rose on Monday on a strong export. And soybean oil on Dalian Commodity Exchange (DCE) broadly fell on Monday but rallied this morning, with a growth of 20-70 CNY/tonne in spot market. Accordingly, cottonseed oil price is supported tentatively. However, U.S. soybean expects a bumper harvest, further straining on global supply. Moreover, soybean arrival is huge in quantity in August and September. And oil futures turn to drop again in afternoon session, depressing the trading in cottonseed oil market. It is predicted that short-term cottonseed oil market may move sideways with fluctuations.

(USD $1=CNY ¥6.97)