Today (Sept 2), 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 due to lukewarm demand. These factors combine to weigh down the market. But soybeans of certain grades are in small supplies as port authorities are making inspections, which will limit the price decline. Overall, short-term imported soybean market may go weakening.

Cottonseed: Cottonseed prices decline by 0.03 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 as old cottonseed is pricey and new cottonseed is about to enter market. Hence, cottonseed market is dragged down. But cottonseed is in short supply as a whole, temporarily supporting cottonseed market. 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 advanced for a seventh session but slowed down gains on Tuesday on good export data and as the good-to-excellent rate for U.S. soybean crops fell 3% from previous week to 66%. Oil futures swing to adjust and actually stay below the previous close on China’s Dalian Commodity Exchange today. In the spot markets, soybean oil goes down 30-50 CNY/tonne and palm oil down 10-30 CNY/tonne, possibly in thinner trade. Exports of Malaysian palm oil products for August plunged between 13.14-15.1% from July, while the output slightly went up by 0.7%. Moreover, China’s soybean oil inventory also rose 4% to 1.31 mln tonnes, as soybean crush remained high due to huge imports. These are negative to the oils market. But U.S. soybean futures keep firm now on a dry weather pattern in the U.S. Midwest and on strong demand from China, so that the cost of importing soybeans has been lifted. And the U.S. dollar is down sharply to around 92. Funds are increasing their long positions in oils due to inflation expectations. These will combine to boost the oils market. The overall oils market may have some adjustments as buyers finish stocking up packaging oils and after new U.S. soybeans go marketing later this month, but it will maintain a strong trend as the inflation expectation will add financial feature to oils.

Soybean oil: GB Grade I soybean oil is mainly priced at 6,860-6,950 CNY/tonne in domestic coastal areas, a decline of 30-50 CNY/tonne. (Tianjin traders 6820; Rizhao traders 6790; Zhangjiagang traders 6910; and Guangzhou traders 6890-6900). 

Palm oil: RBD palm olein is mainly priced at 6,240-6,320 CNY/tonne in coastal areas, mostly down 10-30 CNY/tonne. (Tianjin traders 6300-6320, down 30; Rizhao not available; Zhangjiagang traders 6240, down 30; Guangzhou traders 6320, down 10; and Xiamen not available). 

Rapeseed oil: U.S. soybean futures closed further higher on Tuesday, and rapeseed oil futures swing to decline on China’s Zhengzhou Commodity Exchange today. Spot rapeseed oil prices go down 40-70 CNY at 9,110-9,160 CNY/tonne in coastal regions in tepid trading. Domestic millers have to maintain high soybean crush due to huge imports, and buyers are cautious as rapeseed oil is much more expensive than soybean oil and palm oil, which are dragging down rapeseed oil market. However, 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. Overall, rapeseed oil is predicted to have small downside space and to fluctuate at the high level in the near term. Buyers can temporarily stay on the sidelines.

Cottonseed oil: Cottonseed oil prices mainly stay stable and decreased by 100 CNY/tonne today. Soybean crush remains super high amid huge arrival at ports, leading to a continuous increase in soybean oil inventory. Oil futures on China’s Dalian Commodity Exchange fluctuate to adjust today and move lower than previous closing price. In spot market, soybean oil down by 30-50 CNY/tonne, and palm oil down by 10-30 CNY/tonne. Besides, cottonseed oil trading is light in market, and factories are wary of raising price as new cottonseed is about to go marketing, which limits cottonseed oil market. On the other side, U.S. soybean futures keep firmly on drought weather across crop area and China’s strong demand. With the cost of importing soybean climbing up, oils market is boosted. Additionally, manufacturers have no pressure on inventory as cottonseed is pricey, bolstering cottonseed oil market. Thus, short-term cottonseed oil market is predicted to move sideways with fluctuations.

(USD $1=CNY ¥6.84)