Today (Aug 13), 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. Port soybeans are in dismal trade in China due to seasonally slack demand, so that shipments are also at a slow pace. And the market supply is increasing with imported soybeans from the auctions. Hence, holders are less confident to prop up prices. Imported soybean market is predicted to steady with a weakening trend in the short run.

Cottonseed: Cottonseed prices rise by 0.02-0.03 CNY/kg. 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. And bulk oils go up today. Accordingly, cottonseed market is supported. However, the operation rate among crushing mills is low, and cottonseed oil mills are not active in buying cottonseed due to a high price, which weighs on cottonseed market. Overall, short-term cottonseed market is likely to keep strengthening 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 Wednesday, as substantial purchases of China offset concerns over the bearish USDA monthly report. Chinese market sources are talking that two state-owned companies will purchase 2 mln tonnes of soybean oil. There is no official confirmation till now and some insiders are skeptical of it, but oils futures post strong gains on the Dalian Commodity Exchange today, led by soybean oil, on short covering and bargain hunting. In the spot markets, soybean oil goes up 210-280 CNY/tonne and palm oil up 90-130 CNY/tonne. The trade is predicted to be tepid for spots and see some purchases at low-level forward basis. Domestic soybean oil inventory are growing slowing even under high soybean crush, while the amount in outstanding contracts has surged 6% weekly to 2.553 mln tonnes. Meanwhile, mid-to-downstream buyers are stocking up packaging oils. And domestic palm oil and rapeseed oil stockpiles are low compared to this period in previous years. Besides, there are still concerns over tensions between China and the United States. These together with the market rumor today bolster oils market to rally. However, Malaysia’s palm oil export fell 19.4% in the first ten days of August. And the USDA in a monthly report confirmed a massive harvest of new soybean crops, which will lead to supply stress in September. Domestic plants will maintain high soybean crush with huge soybean arrivals at ports. Hence, the oils market is predicted to fluctuate frequently, and buyers are suggested to remain cautious.

Soybean oil: GB Grade I soybean oil is mainly priced at 6,570-6,680 CNY/tonne in domestic coastal areas, up 210-280 CNY/tonne. (Tianjin traders 6570; Rizhao traders 6570; Zhangjiagang traders 6660; and Guangzhou traders 6680). 

Palm oil: RBD palm olein is mainly priced at 6,010-6,060 CNY/tonne in coastal areas, mostly up 90-130 CNY/tonne. (Tianjin traders 6010, up 130; Rizhao not available; Zhangjiagang traders 6030, up 130; Guangzhou traders 6030-6060, up 110; and Xiamen not available). 

Rapeseed oil: U.S. soybean futures closed higher on Wednesday, and soybean oil futures lead the gains on Chinese oils market today as market sources said that China will purchase 2 mln tonnes of soybean oil. Spot rapeseed oil prices are offered lower by 50-60 CNY at 8,950-9,020 CNY/tonne in coastal regions in tepid trading. China’s rapeseed crush stays at a low level, as its rapeseed imports are limited amid tensions with Canada. Currently, rapeseed oil stockpiles stay at a record low of 203,000 tonnes in China, and palm oil inventories are also at a low level compared to this period in record. However, domestic plants have maintained soybean crush a a very high level due to huge soybean arrivals at ports, and buyers are cautious now as rapeseed oil is much higher price than soybean oil and palm oil. Overall, short-term rapeseed oil will maintain at high levels due to tight supplies, and the trade will be thin.

Cottonseed oil: Cottonseed oil prices stay firmly with partial rises of 50 CNY/tonne today. Cottonseed price is too high and manufacturers have no pressure from inventory. Chinese market sources are talking that two state-owned companies will purchase 2 mln tonnes of soybean oil. There is no official confirmation till now and some insiders are skeptical of it, but oils futures post strong gains on the Dalian Commodity Exchange today, led by soybean oil, on short covering and bargain hunting. In the spot market, soybean oil surges by 210-280 CNY/tonne and palm oil up by 90-130 CNY/tonne, and some cottonseed oil prices follow the rise. But USDA affirmed that U.S. new soybean would have a bumper harvest. Besides, the operation rate among crushing mills will remain high persistently due to huge imports of soybean. Nevertheless, on account of slack demand, most of cottonseed oil plants do not raise the price and just watch the trading in market. It is predicted that short-term cottonseed oil market may follow soyoil to stay strong.

(USD $1=CNY ¥6.94)