I. Soybean

 

Price

 

Domestic soybean: Traders are rushing to liquidate stocks due to a big spread between previous trading prices and current ones. Some participants gave up ex-warehousing their stocks as their losses exceeded the deposit. Moreover, high prices for early-maturing soybeans in Hubei have kept some buyers staying on the sidelines, which is also dragging down domestic soybean prices. However, soybean supply has been decreasing in Jiangsu and some traders have closed their business for a lack of supply in Henan and Anhui, which help support prices to keep firm. In a hybrid of the bull and the bear, domestic soybean market is predicted to steady with a slight decline next week.

 

Imported soybean: Port authorities are conducting strict inspections on the flow of GM soybeans and port traders are controlling soybean volume in circulation, so that soybean supply of certain grades are relatively small at ports now, which is supportive of soybean prices. But port soybean market is in tepid trade as the demand is slack at present. In a hybrid of the bull and the bear, imported soybean market is predicted to stay stable next week. China and the United States have agreed to hold trade talks “in the coming days” to evaluate the progress of their Phase 1 trade deal, so participants can pay close attention to it.

 

China's Soybean Weekly Price（CNY/Tonne）
Region		Grade	This week	Last week	Variation
Northeast China	Heilongjiang	Domestic, GB Grade 3	5,100	5,200	-100
	Inner Mongolia	Domestic, GB Grade 3	5,200	5,200	0
	Heilongjiang	Imported, Russia	4,620	4,650	-30
East China	Jiangsu	Domestic soybean	6,800	6,800	0
	Shandong	Imported, Argentina	3750-3790	3750-3790	0
		Imported, Brazil	N/A	3620
		Imported, Uruguay	3950-4000	3950-4020	-20
North China	Tianjin	Non-GM,Ethiopia	N/A	N/A
		Non-GM, Ukraine	N/A	4800
		Non-GM,  Canada	4800	N/A
		GM, PNW	N/A	N/A
		GM, U.S. GULF	N/A	N/A
National average		Domestic soybean	5,100	5,200	-100
		Imported soybean	3,560	3,550	10

 

 

 

 

Crush: Following a pickup in operation rates this week (Aug 15-21), soybean crush at domestic mills totals 2,017,000 tonnes (meal 1,593,430 tonnes and oil 383,230 tonnes), up 51,200 tonnes or 2.6% from 1,965,800 tonnes last week. Meanwhile, operation rates (capacity utilization) are 58.09%, up 1.47% from 56.62% in the previous week. Soybean crush is predicted to increase to around 2.02 mln tonnes and 2.05 mln tonnes in the coming two weeks, respectively. The crush is likely to go lower than the forecast as some mills may suspend or cut production under swelling meal inventories.

 

Soybean crush nationwide is estimated at 8.99 mln tonnes in August at current utilization rate, above 8.9415 mln tonnes in the previous month and also far above 7.5715 mln tonnes of the corresponding period last year.

 

As of this week, soybean crush nationwide totals 79,880,064 tonnes in the soybean crop year of 2019/20 (from Oct 1st, 2019), up 4,339,679 tonnes or 5.74% from 75,540,385 tonnes of the same period last year. In calendar year of 2020 (from Jan. 1st, 2020), national soybean crush amounts to 57,850,550 tonnes, up 5,461,565 tonnes or 10.43% from 52,388,985 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 21, China’s imported soybean stocks in coastal regions total 6,360,000 tonnes, up 170,800 tonnes by 2.76% from 6,189,200 tonnes last week and up by 17.98% from 5,390,400 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 35 cargoes with 2.327 mln tonnes this week, a total of 97 cargoes with 6.405 mln tonnes for August so far. The import is predicted to be 157.5 cargoes or 10.358 mln tonnes for August, 9.0 mln tonnes for September, 8.2 mln tonnes for October, 8 mln tonnes for November, and 8.3 mln tonnes for December. If so, China’s soybean imports will amount to 97.1448 mln 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 17-21). As of this Friday, prices settle down 10-50 CNY at 2,780-2,910 CNY/tonne in domestic coastal regions. 

 

China's Soybean Meal Weekly Price  (CNY/Tonne)
Region		This week	Last week	Variation
Northeast China	Jilin	3,010	3,040	-30
North China	Tianjin	2,900	2,940	-40
	Hebei	2,910	2,950	-40
Central China	Hubei	2,890	2,920	-30
	Henan	2,970	3,000	-30
East China	Shandong	2,810	2,885	-75
	Jiangsu	2,810	2,860	-50
	Zhejiang	2,820	2,870	-50
	Shanghai	2,840	2,850	-10
	Fujian	2,830	2,870	-40
	Anhui	2,880	2,930	-50
South China	Guangdong	2,800	2,840	-40
	Guangxi	2,820	2,860	-40
National average		2,839	2,886	-47

 

 

Inventory: Soybean meal stocks continue the uptrend under high soybean crush and a slower pace in soybean meal deliveries. In the week as of Aug 21, China’s soybean meal stocks in coastal regions are 1,141,300 tonnes, up 109,900 tonnes by 10.66% from 1,031,400 tonnes last week and up by 55.97% from 731,700 tonnes of the corresponding period last year. Soybean crush is predicted to stay high at 2.02 mln tonnes next week, so soybean meal stocks may continue to increase.

 

 

III. Soybean Oil

 

Price: Domestic soybean oil prices continue an overall downtrend this week (Aug 17-21). As of this Friday, the price for GB Grade I settles at 6,550-6,650 CNY/tonne in domestic coastal regions, mostly down 10-30 CNY/tonne. The overall nationwide price index moves to 6,600 CNY/tonne, a weekly decline of 10 CNY or 0.15% 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	6540-6650	6,660	10-120
North China	Qinhuangdao, Hebei	GB Grade 1	6,650	6,550	100
	Tianjin	GB Grade 1	6,550	6,540	10
East China	Rizhao, Shandong	GB Grade 1	6,570	6,570	0
	Zhangjiagang, Jiangsu	GB Grade 1	6,630	6,660	-30
National average		GB Grade 1	6,600	6,630	-30
		GB Grade 3	6,550	6,580	-30

 

 

Inventory: Soybean oil inventories rally this week following a rise in the crush and the unloading of crude soybean oil at ports. In the week ending Aug 21, China’s soybean oil commercial inventories total 1,259,950 tonnes, up 33,100 tonnes by 2.7% from 1,226,850 tonnes last week, up 44,950 tonnes by 3.7% from 1,215,000 tonnes a month earlier, and down 63,050 tonnes by 4.77% from 1,323,000 tonnes of the corresponding period last year. And the five-year average at the same period is 1,363,200 tonnes.