I. Soybean

 

Price

 

Domestic soybean: Traders are eager to liquidate their stocks due to a big spread between previous trading prices and current ones. In addition, some food manufacturers have turned to imported soybean markets, which further reduces the purchases in northeastern regions. However, soybean crops in Hunan and Hubei have suffered a production reduction due to heavy rainfalls, so that they are unable to substantially pick up the market supply when Jiangsu and Anhui see a bottom in supply. In addition, buyers are active now as early soybean crops are of better quality, which bolsters soybean prices around Jiangsu. In a hybrid of the bull and the bear, domestic soybean market is predicted to keep steady next week.

 

Imported soybean: Holders are unable to pick up soybean shipment pace at domestic ports due to thin trade. China bought a total of 60 vessels last week, and the USDA reported sales to China for 7 consecutive days this week; hence, soybean will see increasing supplies. However, the supply of imported soybeans is relatively limiting at Shandong ports, as traders there are controlling the quantity in circulation. In a hybrid of the bull and the bear, imported soybean market is predicted to stay stable with slight declines next week. Senior U.S. and Chinese officials will review the implementation of their phase one trade deal this week, so market participants can keep an eye on it.

 

China's Soybean Weekly Price（CNY/Tonne）
Region		Grade	This week	Last week	Variation
Northeast China	Heilongjiang	Domestic, GB Grade 3	5,200	5,220	-20
	Inner Mongolia	Domestic, GB Grade 3	5,200	5,200	0
	Heilongjiang	Imported, Russia	4,650	4,650	0
East China	Jiangsu	Domestic soybean	6,800	6,800	0
	Shandong	Imported, Argentina	3750-3790	3790-3850	40-60
		Imported, Brazil	3620	3600	20
		Imported, Uruguay	3950-4020	4000	0
North China	Tianjin	Non-GM,Ethiopia	N/A	N/A
		Non-GM, Ukraine	4800	4950	-150
		Non-GM,  Canada	N/A	N/A
		GM, PNW	N/A	N/A
		GM, U.S. GULF	N/A	N/A
National average		Domestic soybean	5,200	5,220	-20
		Imported soybean	3,550	3,575	-25

 

 

 

 

Crush: Some millers are facing a temporary soybean shortage as they are unable to discharge soybean vessels when berths are under strain at ports, and some are struggling with ballooning soybean meal inventories, so soybean crush continues to decrease this week (Aug 8-14). Specifically, soybean crush at domestic mills totals 1,965,800 tonnes (meal 1,552,982 tonnes and oil 373,502 tonnes), down 78,600 tonnes or 3.8% from 2,044,400 tonnes last week. Meanwhile, operation rates (capacity utilization) are 56.62%, down 2.26% from 58.88% in the previous week. Soybean crush is predicted to increase to around 2 mln tonnes and 2.05 mln tonnes in the coming two weeks, respectively.

 

 As of this week, soybean crush nationwide totals 77,863,064 tonnes in the soybean crop year of 2019/20 (from Oct 1st, 2019), up 4,027,479 tonnes or 5.45% from 73,835,585 tonnes of the same period last year. In calendar year of 2020 (from Jan. 1st, 2020), national soybean crush amounts to 55,833,550 tonnes, up 5,149,365 tonnes or 10.16% from 50,684,185 tonnes of the corresponding period in 2019.

 

 

Inventory: Imported soybean inventories increase in coastal regions this week, as soybean vessels are arriving at ports and millers are unloading cargoes. In the week as of Aug 14, China’s imported soybean stocks in coastal regions total 6,189,200 tonnes, up 150,500 tonnes by 2.49% from 6,038,700 tonnes last week and up by 22.88% from 5,036,600 tonnes of the same period last year. Soybean stocks will gradually build up along with huge soybean arrivals in August.

 

 

Arrivals and the outlook: According to Cofeed, soybean arrivals are 34 cargoes with 2.223 mln tonnes this week, a total of 62 cargoes with 4.076 mln tonnes for August so far. The import is predicted to be 157.5 cargoes or 10.358 mln tonnes for August, 8.9 mln tonnes for September, 8.2 mln tonnes for October, 8 mln tonnes for November, and 8.1 mln tonnes for December. If so, China’s soybean imports will amount to 97.0448 mlln tonnes in 2019/20 (Oct-Sept). Statistics will be updated every week on account of fresh buying and renewed shipments.  

 

II. Soybean Meal

 

Price: Domestic soybean meal prices fluctuate at a narrow range this week (Aug 10-14). As of this Friday, prices fluctuate by 10-20 CNY to settle at 2,840-2,960 CNY/tonne in domestic coastal regions. 

 

China's Soybean Meal Weekly Price  (CNY/Tonne)
Region		This week	Last week	Variation
Northeast China	Jilin	3,040	3,020	20
North China	Tianjin	2,940	2,940	0
	Hebei	2,950	2,940	10
Central China	Hubei	2,920	2,930	-10
	Henan	3,000	3,000	0
East China	Shandong	2,885	2,890	-5
	Jiangsu	2,860	2,845	15
	Zhejiang	2,870	2,870	0
	Shanghai	2,850	2,870	-20
	Fujian	2,870	2,870	0
	Anhui	2,930	2,940	-10
South China	Guangdong	2,840	2,840	0
	Guangxi	2,860	2,870	-10
National average		2,886	2,887	-1

 

 

Inventory: Soybean meal stocks continue the uptrend under high soybean crush. In the week as of Aug 14, China’s soybean meal stocks in coastal regions are 1,031,400 tonnes, up 96,400 tonnes by 10.31% from 935,000 tonnes last week and up by 22.47% from 842,100 tonnes of the corresponding period last year. Soybean crush is predicted to stay high at 2 mln tonnes next week, so soybean meal stocks may continue to increase.

 

 

III. Soybean Oil

 

Price: Domestic soybean oil prices continue an overall uptrend this week (Aug 10-14). As of this Friday, the price for GB Grade I settles at 6,540-6,660 CNY/tonne in domestic coastal regions, mostly up 90-120 CNY/tonne. The overall nationwide price index moves to 6,610 CNY/tonne, a weekly rise of 95 CNY or 1.46% from 6,515 CNY/tonne in the previous week.

 

China's Soybean Oil Weekly Price (CNY/Tonne)
Region		Grade	This week	Last week	Variation
South China	Guangzhou	GB Grade 1	6,660	6,550	110
North China	Qinhuangdao, Hebei	GB Grade 1	6,550	6,550	0
	Tianjin	GB Grade 1	6,540	6430-6440	100-110
East China	Rizhao, Shandong	GB Grade 1	6,570	6,480	90
	Qingdao,Shandong	GB Grade 1	6,550	6,480	70
	Zhangjiagang, Jiangsu	GB Grade 1	6,660	6,550	110
National average		GB Grade 1	6,630	6,515	115
		GB Grade 3	6,580	6,465	115

 

 

Inventory: Soybean oil inventories continue to reduce this week. In the week ending Aug 14, China’s soybean oil commercial inventories total 1,226,850 tonnes, down 15,950 tonnes by 1.28% from 1,242,800 tonnes last week, up 36,950 tonnes by 3.11% from 1,189,900 tonnes a month earlier, and down 126,350 tonnes by 9.34% from 1,353,200 tonnes of the corresponding period last year. And the five-year average at the same period is 1,354,810 tonnes.