Today (Sept 1), the market for oilseeds and oils in China is shown as follows:

Oilseeds:

Imported soybean: The reference price is 3,580-3,660 CNY/tonne for Brazilian soybeans and remains stable at 3,910-4,000 CNY for Uruguayan soybeans at Shandong ports today. Soybean shipments maintain a slow pace at domestic ports as terminal buyers are not active due to lukewarm demand. These factors combine to weigh down the market. Overall, short-term imported soybean market may go weakening due to dismal demand.

Cottonseed: Cottonseed prices decline by 0.08 CNY/kg in several regions today. Though the lockdown in Xinjiang has been lifted gradually, it is still lack of vehicles, so the delivery of cottonseed is still under impact. And 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, so the cottonseed market is supported temporarily. Therefore, short-term cottonseed market is likely to maintain high levels. After new cottonseed intensively enters market, the price will probably fall back from highs.

Oils: 

Summary: U.S. soybean futures extended gains on Monday but settled below the intraday high, as the USDA lowered its good-to-excellent rating of the nation's soybean crops and the dry weather pattern could damage soybean yield potential. Oils futures fell in early trade but then swing to rise on China’s Dalian Commodity Exchange today. In the spot markets, soybean oil mostly goes down 10-40 CNY/tonne with a rise of 20-40 CNY/tonne at some ports, and palm oil goes up partially by 30 CNY/tonne, in tepid trade. Exports of Malaysian palm oil products for August fell 13.1% to 1.49 mln tonnes from previous month. China’s soybean oil inventory also went up 4% to 1.31 mln tonnes, as soybean crush remained high due to huge imports. These are somewhat negative to the oils market. But the cost of importing soybeans has been higher as U.S. soybean prices keep firm. Besides, funds are increasing their long positions in oils due to inflation expectations and broadly higher prices of industrial products. Overall, domestic oils market is predicted to keep a strengthening trend before the end of replenishing packaging oils and ahead of the marketing of new U.S. soybeans.

Soybean oil: GB Grade I soybean oil is mainly priced at 6,860-6,950 CNY/tonne in domestic coastal areas, mostly down 10-40 CNY/tonne but a rise of 20-40 CNY/tonne at some ports. (Tianjin traders 6860; Rizhao traders 6800; Zhangjiagang traders 6950; and Guangzhou traders 6910-6930). 

Palm oil: RBD palm olein is mainly priced at 6,250-6,330 CNY/tonne in coastal areas, partially up 30 CNY/tonne. (Tianjin traders 6310-6330, flat; Rizhao not available; Zhangjiagang traders 6250, flat; Guangzhou traders 6310, up 30; and Xiamen not available). 

Rapeseed oil: U.S. soybean futures closed higher on Monday, and rapeseed oil futures open high to rise on China’s Zhengzhou Commodity Exchange today. Spot rapeseed oil prices go up 60-80 CNY at 9,150-9,230 CNY/tonne in coastal regions in tepid trading. China’s rapeseed imports are limited amid tensions between Beijing and Ottawa. As rapeseed crush remains at a low level, crushing plants are mainly carrying out contracts at present. Currently, rapeseed oil stockpiles are 227,000 tonnes, a decline of 49% from a year earlier. But the consumption of rapeseed oil in China is affected by its widening price spread with soybean oil and palm oil. Overall, rapeseed oil market is predicted to stay high due to tight supplies and as investors are increasing long positions in oils under an inflation expectation, and the market will still be in thin trade.

Cottonseed oil: Cottonseed oil prices stay stable today. U.S. soybean rose further on Monday as persistent drought could reduce soybean crop yield potential. Oil futures on China’s Dalian Commodity Exchange pare gains in morning session. But many investors take a buying on the dips due to inflation expectation, which leads oils to go up with fluctuations. In spot market, soybean oil mostly decreases by 10-40 CNY/tonne but rises by 30 CNY/tonne at some ports, and palm oil partly up by 30 CNY/tonne. Thus, bulk oils market keeps strengthening. Additionally, manufacturers have no pressure on inventory as cottonseed is pricey, bolstering cottonseed oil market. But soybean crush remains super high amid huge arrival at ports, leading to a continuous increase in soybean oil inventory. This is bearish for oils market. Moreover, cottonseed oil trading is tepid due to slack demand, and factories are cautious in raising price as new cottonseed is about to go marketing. Thus, cottonseed oil price may be curbed by these factors, and short-term cottonseed oil market is predicted to fluctuate at high levels.

(USD $1=CNY ¥6.85)