Today (Oct 15), the market for oilseeds and oils in China is shown as follows:

Oilseeds:

Imported soybean: Prices are almost not available and shipments also come to a standstill at ports due to strict commodity inspections. The supply of non-GM soybeans is gradually decreasing, which is supporting the market. However, imported soybean market has no advantage now due to sluggish port shipments and as new domestic soybeans are on the market and of improved quality. These are negative to the market. Overall, imported soybean market is predicted to steady with slight declines in the near term.

Cottonseed: Cottonseed prices steadily grow by 0.02-0.04 CNY/kg in several regions today. The delivery of cottonseed is still under impact of the COVID-19 outbreak in Xinjiang. Besides, the quantity of new cottonseed appeared on the market is increasing day by day, and oil plants are cautious in purchasing cottonseed due to current high price. Additionally, cottonseed output this year has decreased compared with the previous year. And cottonseed oil and cottonseed meal are keeping strengthening for the moment. Thus, cottonseed market is supported. In short, cottonseed market will maintain a strong trend in the near term.

Oils: 

Summary: U.S. soybean futures continued rising on Wednesday on export sales to China and as a lack of rainfall was threatening soybean planting in Brazil’s farming regions.

Oils futures fluctuate to decline due to profit-taking on China’s Dalian Commodity Exchange today. In the spot markets, spot soybean oil goes down 20-60 CNY/tonnes and palm oil down 100 CNY/tonne in tepid trade.

China’s soybean crush will return to a high level of over 2 mln tonnes this week. After GAPKI said that Indonesian palm oil stockpiles surged higher than the forecast, the market sentiment is further affected as the consumption of biodiesel in the first three quarters in this country only totaled 6.17 mln kiloliters. Based on this volume, Indonesia’s blending of biodisel is predicted to be only 8.23 mln kl, which will likely fail to reach the expectation. Moreover, Malaysia’s palm oil exports in October 1-15 fell 2.1% month on month, which also dragging down oils prices to decline. However, soybean oil stockpiles are modest, and rapeseed oil and palm oil inventories are also low, while feed use of soybean oil shows a big increment this year; hence, the supply of oils are not under pressure. In addition, participants are focusing closely on weather conditions for soybean planting in South American producing regions, coupled with a lingering global inflation expectation, so the oils market will fluctuate to maintain an uptrend. Overall, short-term oils market will probably follow futures to fluctuate frequently.

Soybean oil: GB Grade I soybean oil is mainly priced at 7,440-7,550 CNY/tonne in domestic coastal areas, a decline of 20-60 CNY/tonne. (Tianjin traders 7440-7450; Rizhao traders 7500; Zhangjiagang traders 7500; and Guangzhou traders 7550).

Palm oil: RBD palm olein is mainly priced at 6,630-6,710 CNY/tonne in coastal areas, mostly down 100-110 CNY/tonne. (Tianjin traders 6710, down 100; Rizhao not available; Zhangjiagang traders 6660, down 100; Guangzhou traders 6630, down 110; and Xiamen not available). 

Rapeseed oil: U.S. soybean futures closed higher on Wednesday, but rapeseed oil futures fluctuate to decline on profit-taking on China’s Zhengzhou Commodity Exchange today. Spot rapeseed oil prices go down 10-30 CNY to 9,620-9,690 CNY/tonne in coastal regions in tepid trading.

China’s soybean crush will go back to a high level over 2 mln tonnes this week due to adequate soybean stocks, which will be dragging down rapeseed oil prices. But China’s rapeseed crush is not substantial as its imports are limited amid tensions between Beijing and Ottawa. And domestic soybean oil stocks are not at a high level, while rapeseed oil and palm oil stockpiles also remain low. In addition, there is a rise in demand for oils from feed, so the oils market is stress-free in terms of supply. Meanwhile, funds are keen to buy dips for long positions due to a lingering global inflation expectation. Overall, rapeseed oil prices will have limited declines in the near term and will maintain at the high level.

Cottonseed oil: Cottonseed oil prices mainly keep steady and further increase by 100 CNY/tonne in individual regions today. Market sentiment is still affected by weather condition across soybean area in South America, and funds flow into market on the dips due to existing global inflation expectations. Besides, the consumption of oil for feedstuffs has increased this year with no pressure on supply. Moreover, the operation rate in cottonseed crushing mills still stays at a low level. Hence, these have offered support to cottonseed oil market. However, oil futures on China’s Dalian Commodity Exchange fluctuate to fall back today on the profit taking. In spot market, soybean oil down by 20-60 CNY/tonne and palm oil down by 100 CNY/tonne. But bulk oils market will still maintain a strong trend in the near term. It is predicted that the market outlook of cottonseed oil may also fluctuate to go up. Buyers had better pay attention that if the falls of bulk oils will affect short-term trend of cottonseed oil.

(USD $1=CNY ¥6.74)