Today (Sep 3), 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. Strict commodity inspections make the supply of certain grades of soybeans reduce at domestic ports. But the market is tepid trade due to slack demand at present. Moreover, supplies of imported soybeans may get increasing as China is likely to continue its purchases of U.S. soybeans, which is also negative to the market in China. Overall, imported soybean market is predicted to be little changed before the end of the commodity inspections.

Cottonseed: Cottonseed prices decline by 0.02CNY/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 while new cottonseed is about to enter market. Hence, cottonseed market is dragged down. But cottonseed is in short supply, 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 in phases.

Oils: 

Summary: U.S. soybean futures advanced for an eighth session on Wednesday on dryness in the Corn Belt and as Chinese state-owned firms bought at least eight cargoes of U.S. soybeans, and oils futures also move sharply higher on China’s Dalian Commodity Exchange today. In the spot markets, soybean oil goes up 80-160 CNY/tonne and palm oil up 70-80 CNY/tonne, with good trade at low-level basis. Increasing U.S. soybean prices keep import cost growing. Indonesian palm oil production is seen at 46.02 mln tonnes, down from 47.11 mln tonnes in 2019, according to the country’s Palm Oil Association. Besides, Malaysian ringgit has been weak recently, and U.S. dollar is down sharply to around 92. Funds are increasing their long positions in oils due to inflation expectations. Hence, domestic oils futures shoot higher today. Overall, the oils market is predicted to maintain a strong trend, and may go into corrections after buyers complete stocking up packaging oils and U.S. soybeans go market in huge quantity.

Soybean oil: GB Grade I soybean oil is mainly priced at 6,950-7,040 CNY/tonne in domestic coastal areas, a rise of 80-160 CNY/tonne. (Tianjin traders 6960; Rizhao traders 6950; Zhangjiagang traders 7040; and Guangzhou traders 7020-7040).

Palm oil: RBD palm olein is mainly priced at 6,370-6,460 CNY/tonne in coastal areas, mostly up 70-80 CNY/tonne. (Tianjin traders 6450, up 70; Rizhao 6460, up 70; Zhangjiagang traders 6370, up 70; Guangzhou traders 6460-6470, up 80; and Xiamen not available). 

Rapeseed oil: U.S. soybean futures closed further higher on Wednesday, and rapeseed oil futures swing to decline on China’s Zhengzhou Commodity Exchange today. Spot rapeseed oil prices go up 70-90 CNY at 9,200-9,250 CNY/tonne in coastal regions in tepid trading. The imports of rapeseed are small in China due to tensions between Beijing and Ottawa, so that rapeseed crush has been at a low level and millers are mainly carrying out contracts of rapeseed oil. Currently, domestic rapeseed oil stockpiles are only 227,000 tonnes in coastal regions, a decline of 49% from a year earlier. These help support the rapeseed oil market. However, as huge soybean imports have been keeping soybean crush at a high level, which is predicted to be 2.04 mln tonnes this week and 2.07 mln tonnes next week, soybean oil stocks continue increasing. In addition, the consumption of rapeseed oil in China now is affected by its widening price spread with soybean oil and palm oil. Overall, rapeseed oil is predicted to stay at the high level due to tight supplies and as funds are increasing positions in oils due to an inflation expectation, and the market will be still in thin trade.

Cottonseed oil: Cottonseed oil prices stay stable today. Soybean crush remains super high amid huge arrival at ports, leading to a continuous increase in soybean oil inventory. And the peak season for stockpiling packing oil is coming to an end, which is bearish for oils market. Besides, new cottonseed is about to go marketing, so factories are wary of raising price, limiting cottonseed oil price. However, U.S. soybean futures are climbing up, thereby pushing up its import cost. Moreover, oil futures on China’s Dalian Commodity Exchange jump much higher today. In spot market, soybean oil up by 80-160 CNY/tonne, and palm oil up by 70-80 CNY/tonne. Additionally, manufacturers have no pressure on inventory as cottonseed is pricey, bolstering cottonseed oil market. Thus, short-term cottonseed oil market is predicted to maintain highs with fluctuations.

(USD $1=CNY ¥6.83)