Today (Oct 10), the market for oilseeds and oils in China is shown as follows:

Oilseeds:

Imported soybean: Non-GM Canadian soybeans are priced at 4,850 CNY/tonne at Tianjin port. Soybean shipments are small at Shandong ports under strict commodity inspections but will probably recover in days. Moreover, imported non-GM soybeans are in adequate stocks, and new domestic soybeans are on marketing and of higher and higher quality. Therefore, traders are rushing to liquidating imported soybean stocks. In addition, China ramped up soybean purchases earlier, which is likely to further expand the supply. Overall, imported soybean market is predicted to steady with slight declines in the near term.

Cottonseed: Cottonseed prices increase by 0.02-0.05 CNY/kg today. Cottonseed is still in temporary shortage, which tentatively supports cottonseed market. But the delivery of cottonseed is still under impact of the COVID-19 outbreak in Xinjiang. Besides, cottonseed price is high in market, dampening inland oil mills in making purchase. Moreover, factories are wary of buying cottonseed as cottonseed by-products move weakly overall. Due to a surge in bulk oils and meals market after National Day holidays, cottonseed price is projected to be boosted and extend the rally.

Oils: 

Summary: U.S. soybean futures jumped higher to 1065.5 cents on Friday, as the USDA in its October supply and demand report pegged U.S. soybean ending stocks and production much lower than the market expectation. And Malaysian palm oil futures also rose on Friday on the forecast for higher October exports and on worries about production under heavy rains and the pandemic movement restrictions. China’s commodity exchanges are closed on Saturday today, but spot oils prices advance on the back of strong foreign markets, with soybean oil and palm oil both go up 90-140 CNY/tonne. China’s weekly soybean crush fell sharply to 1.39 mln tonnes last week from a high level of over 2 mln tonnes ahead of the holidays. Currently, soybean oil inventory is not pressuring the market, and rapeseed oil stocks are also low. In addition, heavy rains incurred by La Nina has already interrupted palm oil production in Southeast Asian countries, which could lead to a fall in global crude palm oil supply. Meanwhile, funds may stage a comeback on a lingering global inflation expectation and as the market is focusing on weather conditions for soybean planting in South American countries. Overall, short-term oils market will likely maintain a strong trend in the near term, and participants can keep an eye on U.S. soybean marketing and China’s soybean crush.

Soybean oil: GB Grade I soybean oil is mainly priced at 7,450-7,620 CNY/tonne in domestic coastal areas, a rise of 100-140 CNY/tonne. (Tianjin traders 7450; Rizhao traders 7470; Zhangjiagang traders not offering; and Guangzhou traders 7620).

Palm oil: RBD palm olein is mainly priced at 6,700-6,760 CNY/tonne in coastal areas, mostly up 120-140 CNY/tonne. (Tianjin traders 6750, up 120; Rizhao 6760, up 120; Zhangjiagang traders 6700, up 140; Guangzhou traders 6700, up 140; and Xiamen not available). 

Rapeseed oil: U.S. soybean futures closed sharply higher on Friday on a bullish USDA supply and demand report, and China’s futures market is closed on Saturday today. Spot rapeseed oil prices scarcely steady at 9,560-9,600 CNY/tonne in coastal regions in tepid trading. China’s rapeseed crush remains at a relatively low level due to limited rapeseed imports amid tensions between Beijing and Ottawa. Domestic soybean oil inventory is under no pressure as soybean crush has fallen a bit during the holidays, and rapeseed oil and palm oil stockpiles are also at low levels in coastal regions, which are adding support to rapeseed oil market. The active sentiment of funds may be fueled by lingering global inflation expectations and as the market is focusing on weather conditions for soybean planting in South American countries. Overall, rapeseed oil prices are predicted to stay at the high level in the short run and in tepid trade.

Cottonseed oil: Cottonseed oil prices keep steady and increase by 200 CNY/tonne in several regions today. U.S. soybean futures skyrocketed to 1065.5 cents on Friday as USDA supply and demand report in October indicated that both the ending stock and production of soybean were lower than expected. Besides, palm oil on Bursa Malaysia Derivatives also rose yesterday on increased expectation of export in October, concerns over production affected by rainstorm and restrictions amidst COVID-19 outbreak. Considering strong performance in foreign markets, oils in spot market continue posting broad gains today, and soybean oil and palm oil up by 90-140 CNY/tonne. In addition, global inflation expectations still exist, and markets are worry about the weather during the planting season of South American soybean. In this case, oils market has returned to bounce back. Moreover, the operation rate in cottonseed crushing mills still stays at a low level, offering support to cottonseed oil market. It is predicted that short-term cottonseed oil price may fluctuate to rally tracking soybean oil.

(USD $1=CNY ¥6.78)