I. Soybean

 

Price

 

Domestic soybean: Heilongjiang producing regions in northeast China have suffered three typhoons recently, but surveys show that only the most severely-hit region Suihua is likely to face a reduction in production and other regions are in safety zones. In addition, there has been a rise in the planting area this year. Hence, a bumper soybean production outlook in main producing regions is little changed. The marketing of new soybeans starts counting down, so that traders are undercutting prices to clear stocks to make room for new crops. However, farmers in Hunan and Hubei are harvesting their soybean crops and some of them are stalling sales due to a reduction in production. And 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 also supportive of soybean market in these regions. In a hybrid of the bull and the bear, domestic soybean market is predicted to steady and fractionally swing next week. Participants can keep an eye on the influence of the weather.

 

Imported soybeans: Prices are almost not offered and holders are unable to ship soybeans due to strict commodity inspections on the flow of GM-soybeans at Shandong ports, and non-GM soybeans are in adequate supplies now. Moreover, domestic soybean prices have been declining and new soybeans are about to go marketing. And downstream buyers are not active under slack demand. In addition, China continues purchasing U.S. soybeans, with at least 30 vessels last week and 14-15 vessels this week. This will probably amplify the market supply, and without the support of bulk demand, it will further bring negative sentiment to the market. Overall, imported soybean market is predicted to steady with a slight decline next week due to dismal demand, and participants can keep an eye on domestic commodity inspection and demand.

 

China's Soybean Weekly Price（CNY/Tonne）
Region		Grade	This week	Last week	Variation
Northeast China	Heilongjiang	Domestic, GB Grade 3	4,900	4,960	-60
	Inner Mongolia	Domestic, GB Grade 3	5,100	5,100	0
	Heilongjiang	Imported, Russia	4,620	4,620	0
East China	Jiangsu	Domestic soybean	6,800	6,800	0
	Shandong	Imported, Argentina	N/A	N/A
		Imported, Brazil	N/A	3580-3660
		Imported, Uruguay	N/A	N/A
North China	Tianjin	Non-GM,Ethiopia	N/A	N/A
		Non-GM, Ukraine	N/A	4800
		Non-GM,  Canada	5150	N/A
		GM, PNW	N/A	N/A
		GM, U.S. GULF	N/A	N/A
National average		Domestic soybean	4,900	4,960	-60
		Imported soybean	3,530	3,530	0

 

 

 

 

Crush: With a slight rise in operation rates this week (Sept 5-11), soybean crush at domestic mills totals 1,971,650 tonnes (meal 1,557,604 tonnes and oil 374,614 tonnes), up 20,600 tonnes or 1.05% from 1,951,050 tonnes last week. Meanwhile, operation rates (capacity utilization) are 56.76%, up 0.57% from 56.19% in the previous week. Soybean crush is predicted to increase to around 2.02 mln tonnes and 2.08 mln tonnes in the coming two weeks, respectively.  

 

As of this week, soybean crush nationwide totals 85,840,964 tonnes in the soybean crop year of 2019/20 (from Oct 1st, 2019), up 4,787,329 tonnes or 5.91% from 81,053,635 tonnes of the same period last year. In calendar year of 2020 (from Jan. 1st, 2020), national soybean crush amounts to 63,811,450 tonnes, up 5,909,215 tonnes or 10.21% from 57,902,235 tonnes of the corresponding period in 2019.

 

 

Inventory: Imported soybean inventories continue increasing in coastal China this week, as soybeans are going into warehouses after a delay in unloading previously. In the week as of Sept 11, China’s imported soybean stocks in coastal regions total 6,608,000 tonnes, up 128,600 tonnes by 1.98% from 6,479,400 tonnes last week and up by 23.81% from 5,337,100 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 29 cargoes with 1.909 mln tonnes this week, a total of 40 cargoes with 2.602 mln tonnes for September 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 96.7898 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 continue rising this week (Sept 7-11). As of this Friday, prices settle up 70-110 CNY at 2,950-3,070 CNY/tonne in domestic coastal regions. 

 

China's Soybean Meal Weekly Price  (CNY/Tonne)
Region		This week	Last week	Variation
Northeast China	Jilin	3,150	3,070	80
North China	Tianjin	3,070	2,990	80
	Hebei	3,060	2,990	70
Central China	Hubei	3,030	2,960	70
	Henan	3,170	3,030	140
East China	Shandong	2,990	2,920	70
	Jiangsu	2,970	2,880	90
	Zhejiang	2,990	2,880	110
	Shanghai	2,960	2,870	90
	Fujian	2,990	2,880	110
	Anhui	3,010	2,920	90
South China	Guangdong	2,970	2,890	80
	Guangxi	3,010	2,930	80
National average		3,008	2,920	88

 

 

Inventory: Soybean meal stocks continue reducing this week, as mid-and-downstream buyers are picking up soybean meal in the wake of a rise in price. In the week as of Sept 11, China’s soybean meal stocks in coastal regions are 1,066,500 tonnes, down 95,800 tonnes by 8.24% from 1,162,300 tonnes last week but up by 43.73% from 742,000 tonnes of the corresponding period last year. Soybean crush is predicted to stay high at 2.02 mln tonnes next week, which will slow down the decline in soybean meal stocks.

 

 

III. Soybean Oil

 

Price: Domestic soybean oil prices continue the uptrend this week (Sept 7-11). As of this Friday, the price for GB Grade I settles at 7,000-7,050 CNY/tonne in domestic coastal regions, mostly up 20-110 CNY/tonne. The overall nationwide price index moves to 7,010 CNY/tonne, a weekly rise of 60 CNY or 0.86% from 6,950 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	7000-7020	6940-6980	40-60
		GB Grade 3	N/A	N/A
North China	Qinhuangdao, Hebei	GB Grade 1	7,000	6,920	80
		GB Grade 3	6,900	6,820	80
	Tianjin	GB Grade 1	6,970	6,900	70
		GB Grade 3	N/A	6,900
East China	Rizhao, Shandong	GB Grade 1	6,980	6,900	80
		GB Grade 3	N/A	N/A
	Zhangjiagang, Jiangsu	GB Grade 1	7010-7020	6,970	40-50
		GB Grade 3	N/A	N/A
National average		GB Grade 1	7,010	6,990	20
		GB Grade 3	6,960	6,940	20

 

 

Inventory: In the week ending Sept 11, China’s soybean oil commercial inventories total 1,271,550 tonnes, down 3,400 tonnes by 0.27% from 1,274,950 tonnes last week, up 36,550 tonnes by 2.96% from 1,235,000 tonnes a month earlier, and down 58,450 tonnes by 4.39% from 1,330,000 tonnes of the corresponding period last year. And the five-year average at the same period is 1,346,000 tonnes.