I. Soybean

 

Price

 

Domestic soybean: Domestic traders have undercut prices as they are clearing storage to make room for new soybeans which will go marketing in about one month. Soybean prices in producing regions have also declined. However, soybean crop will probably see smaller production this year as pod setting is dismal in the wake of heavy rains in Henan and Anhui. In addition, some traders have been out of stocks now due to decreasing supplies around Jiangsu, and some with stock in hand are propping up prices, which is supportive of soybean market in these regions. In a hybrid of the bull and the bear, domestic soybean market is predicted to steady with a slight decline next week.

 

Imported soybean: Imported soybean market is dismal trade at ports as there is little demand at present so that traders have to reduce prices. During their phone talk this week, China and the United States agreed to create conditions and atmosphere to continue pushing forward the implementation of the trade deal, according to China’s Ministry of Commerce. And a Bloomberg report said that China will purchase 40 mln tonnes of U.S. soybeans in 2020. This will add to soybean supply in China, and domestic soybean market will come under pressure if in the absence of support from strong demand. However, soybean supplies are not very much now at domestic ports as some cargoes are still waiting to go through customs, which lend some support to the market. Dominated by such bearish factors, imported soybean market is predicted to stay stable with slight declines. Participants can pay attention to upcoming vessels and domestic demand.

 

China's Soybean Weekly Price（CNY/Tonne）
Region		Grade	This week	Last week	Variation
Northeast China	Heilongjiang	Domestic, GB Grade 3	4,960	5,100	-140
	Inner Mongolia	Domestic, GB Grade 3	5,100	5,200	-100
	Heilongjiang	Imported, Russia	4,620	4,620	0
East China	Jiangsu	Domestic soybean	6,800	6,800	0
	Shandong	Imported, Argentina	3730-3770	3750-3790	-20
		Imported, Brazil	3610-3660	N/A
		Imported, Uruguay	3910-4000	3950-4000	-40
North China	Tianjin	Non-GM,Ethiopia	N/A	N/A
		Non-GM, Ukraine	N/A	N/A
		Non-GM,  Canada	4800	4800	0
		GM, PNW	N/A	N/A
		GM, U.S. GULF	N/A	N/A
National average		Domestic soybean	4,960	5,100	-140
		Imported soybean	3,540	3,560	-20

 

 

 

 

Crush: Following a further rise in operation rates this week (Aug 22-28), soybean crush at domestic mills totals 2,038,200 tonnes (meal 1,610,178 tonnes and oil 387,258 tonnes), up 21,200 tonnes or 1.05% from 2,017,000 tonnes last week. Meanwhile, operation rates (capacity utilization) are 58.70%, up 0.61% from 58.09% in the previous week. Soybean crush is predicted to increase to around 2.04 mln tonnes and 2.07 mln tonnes in the coming two weeks, respectively.

 

Soybean crush nationwide is estimated at 8.95 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 81,918,264 tonnes in the soybean crop year of 2019/20 (from Oct 1st, 2019), 4,477,479 tonnes or 5.78% above 77,440,785 tonnes of the same period last year. In calendar year of 2020 (from Jan. 1st, 2020), national soybean crush amounts to 59,888,750 tonnes, 5,599,365 tonnes or 10.31% above 54,289,385 tonnes of the corresponding period in 2019.

 

 

 

Inventory: Imported soybean inventories have reduced this week, as soybean crush increases to 2.03 mln tonnes and soybean vessels are in slow unloading pace at some ports. In the week as of Aug 28, China’s imported soybean stocks in coastal regions total 6,039,700 tonnes, down 320,300 tonnes by 5.04% from 6,360,000 tonnes last week yet up by 15.41% from 5,233,200 tonnes of the same period last year. Domestic soybean stocks usually decreased gradually from September in previous years, but China has purchased much more U.S. soybeans this year as a part of the trade deal, so it is necessary to focus on soybean crush.

 

 

Arrivals and the outlook: According to Cofeed, soybean arrivals are 36.5 cargoes with 2.386 mln tonnes this week, a total of 137.5 cargoes with 9.039 mln tonnes for August so far. The import is predicted to be 137 cargoes or 9.012 mln tonnes for September, 8.5 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 97.1568 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 to rise this week (Aug 24-28). As of this Friday, prices settle up 20-70 CNY at 2,840-2,980 CNY/tonne in domestic coastal regions. 

 

China's Soybean Meal Weekly Price  (CNY/Tonne)
Region		This week	Last week	Variation
Northeast China	Jilin	3,060	3,010	50
North China	Tianjin	2,970	2,900	70
	Hebei	2,980	2,910	70
Central China	Hubei	2,930	2,890	40
	Henan	3,010	2,970	40
East China	Shandong	2,880	2,810	70
	Jiangsu	2,865	2,810	55
	Zhejiang	2,900	2,820	80
	Shanghai	2,880	2,840	40
	Fujian	2,870	2,830	40
	Anhui	2,930	2,880	50
South China	Guangdong	2,850	2,800	50
	Guangxi	2,880	2,820	60
National average		2,893	2,839	54

 

 

Inventory: Soybean meal stocks continue the uptrend under high soybean crush and a slower pace in soybean meal trade and delivery. In the week as of Aug 28, China’s soybean meal stocks in coastal regions are 1,202,600 tonnes, up 61,300 tonnes by 5.37% from 1,141,300 tonnes last week and up by 54.85% from 776,600 tonnes of the corresponding period last year. Soybean crush is predicted to stay high at 2.04 mln tonnes next week, so soybean meal stocks may continue to increase.

 

 

III. Soybean Oil

 

Price: Domestic soybean oil prices follow futures to climb this week (Aug 24-28). As of this Friday, the price for GB Grade I settles at 6,770-6,870 CNY/tonne in domestic coastal regions, mostly up 120-260 CNY/tonne. The overall nationwide price index moves to 6,830 CNY/tonne, a weekly rise of 230 CNY or 3.48% from 6,600 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	6,870	6540-6650	220-330
North China	Qinhuangdao, Hebei	GB Grade 1	6,800	6,650	150
	Tianjin	GB Grade 1	6810-6820	6,550	270-280
East China	Rizhao, Shandong	GB Grade 1	6,770	6,570	200
	Zhangjiagang, Jiangsu	GB Grade 1	6,870	6,630	240
National average		GB Grade 1	6,870	6,600	270
		GB Grade 3	6,820	6,550	270

 

 

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 28, China’s soybean oil commercial inventories total 1,307,450 tonnes, up 47,500 tonnes by 3.77% from 1,259,950 tonnes last week, up 67,450 tonnes by 5.44% from 1,240,000 tonnes a month earlier, and down 22,050 tonnes by 1.66% from 1,329,500 tonnes of the corresponding period last year. And the five-year average at the same period is 1,372,800 tonnes.