I. Soybean

 

Price

 

Domestic soybean: Chinese farmers are harvesting soybean crops at a slow pace in northeastern producing regions due to the rainy weather, and old soybean prices have hit a new high previously, so farmers are bullish about the market and tend to stall sales. In addition, there is a sharp production reduction around Jiangsu producing regions. Hence, soybean supply will fall short of demand in the near term. Meanwhile, buyers are briskly purchasing new soybeans, and No. 1 soybean futures on Dalian Commodity Exchange also keeps moving higher, which is bullish to domestic soybean market. However, it is almost an established fact that China’s soybean production will get a rise this year, so with the progress of harvests, domestic soybean supply may turn loose. Besides, Sigograin has not yet announced its purchasing policies, which will also constrain the market. In a hybrid of the bull and the bear, domestic soybean market may keep strong with some fluctuations next week. Farmers’ sales sentiment will be closely watched.

 

Imported soybean: Prices are almost not available and shipments also come to a standstill at ports this week due to strict commodity inspections, which is supporting imported soybean 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. The effective supply will increase in the market, and China is also briskly purchasing U.S. soybeans, which will also lift the market supply. On the while, imported soybean market is predicted to be little changed before the end of the port commodity inspections.

 

China's Soybean Weekly Price（CNY/Tonne）
Region		Grade	This week	Last week	Variation
Northeast China	Heilongjiang	Domestic, GB Grade 3	4,680	4,900	-220
	Inner Mongolia	Domestic, GB Grade 3	4,560	N/A
	Heilongjiang	Imported, Russia	N/A	4,600
East China	Jiangsu	Domestic soybean	6,700	6,150	550
	Shandong	Imported, Argentina	N/A	N/A
		Imported, Brazil	N/A	N/A
		Imported, Uruguay	N/A	N/A
North China	Tianjin	Non-GM,Ethiopia	N/A	N/A
		Non-GM, Ukraine	N/A	5100
		Non-GM,  Canada	N/A	4950-5200
		GM, PNW	N/A	N/A
		GM, U.S. GULF	N/A	N/A
National average		Domestic soybean	4,680	4,900	-220
		Imported soybean	3,530	3,530	0

 

 

 

 

Crush: With the end of the Mid-Autumn and the National Day holidays, operation rates for soybean crush quickly pick up to a very high level this week (Oct 10-16). Specifically, soybean crush at domestic mills totals 2,088,300 tonnes (meal 1,649,757 tonnes and oil 396,777 tonnes), up 700,750 tonnes or 50.5% from 1,387,550 tonnes last week. Meanwhile, operation rates (capacity utilization) are 60.12%, up 20.17% from 39.95% in the previous week. Soybean crush is expected to continue its rise to 2.14 mln tonnes and 2.16 mln tonnes in the next two weeks.

 

In the crop year of 2020/21 (from Oct 1st, 2020), China’s soybean crush totals 4,011,114 tonnes, up 328,514 tonnes or 8.92% from 3,682,600 tonnes a year earlier.

 

In the calendar year of 2020 (from Jan. 1st, 2020), China’s soybean crush amounts to 73,617,800 tonnes, up 7,893,515 tonnes or 12.01% from 65,724,285 tonnes of the corresponding period in 2019.

 

 

 

Inventory: Imported soybean inventories decline in coastal regions this week, as soybean crush picks up sharply to 2.08 mln tonnes. In the week as of Oct 16, China’s imported soybean stocks in coastal regions total 5,872,700 tonnes, down 90,800 tonnes by 1.52% from 5,963,500 tonnes last week and up by 49.61% from 3,925,100 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 31 cargoes with 2.042 mln tonnes this week, a total of 57 cargoes with 3.711 mln tonnes for October so far. The import is predicted to be 133 cargoes or 8.663 mln tonnes for October, 8.9 mln tonnes for November, 8.8 mln tonnes for December, and 7.5 mln tonnes for January. 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 (Oct 12-16). As of this Friday, prices settle up 10-60 CNY at 3,200-3,280 CNY/tonne in domestic coastal regions. 

 

China's Soybean Meal Weekly Price  (CNY/Tonne)
Region		This week	Last week	Variation
Northeast China	Jilin	3,440	3,200	240
North China	Tianjin	3,290	3,070	220
	Hebei	3,290	3,080	210
Central China	Hubei	3,300	3,090	210
	Henan	3,390	3,170	220
East China	Shandong	3,240	3,030	210
	Jiangsu	3,205	2,980	225
	Zhejiang	3,200	3,020	180
	Shanghai	3,210	3,000	210
	Fujian	3,230	3,020	210
	Anhui	3,290	3,050	240
South China	Guangdong	3,210	3,010	200
	Guangxi	3,260	3,030	230
National average		3,241	3,031	210

 

 

Inventory: Soybean meal stocks continue reducing this week. In the week as of Oct 16, China’s soybean meal stocks in coastal regions are 889,900 tonnes, down 49,700 tonnes by 5.29% from 939,600 tonnes last week but up by 55.08% from 573,800 tonnes of the corresponding period last year. As soybean crush is predicted to pick up to 2.1 mln tonnes next week, soybean meal stocks are forecast to slow down declines.

 

 

III. Soybean Oil

 

Price: Domestic soybean oil prices fluctuate this week (Oct 12-16). As of this Friday, the price for GB Grade I settles at 7,340-7,440 CNY/tonne in domestic coastal regions, fluctuating by 20-80 CNY/tonne. The overall nationwide price index moves to 7,385 CNY/tonne, a weekly decline of 5 CNY or 0.07% from 7,390 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	7440	7260-7280	160-180
		GB Grade 3	N/A	N/A
North China	Qinhuangdao, Hebei	GB Grade 1	7,450	N/A
		GB Grade 3	7,350	N/A
	Tianjin	GB Grade 1	7340-7360	7150-7160	190-200
		GB Grade 3	N/A	N/A
East China	Rizhao, Shandong	GB Grade 1	7,390	7,200	190
		GB Grade 3	N/A	N/A
	Zhangjiagang, Jiangsu	GB Grade 1	7,390	7,190	200
		GB Grade 3	N/A	N/A
National average		GB Grade 1	7,390	7,180	210
		GB Grade 3	7,340	7,130	210

 

 

Inventory: Soybean oil stocks obviously decline this week, as buyers from various fields are stocking up soybean oil now, and the consumption of soybean oil to replace its rivals and in feed is still large. In the week ending Oct 16, China’s soybean oil commercial inventories total 1,288,400 tonnes, down 55,700 tonnes by 4.14% from 1,344,100 tonnes last week, down 11,600 tonnes by 0.89% from 1,300,000 tonnes a month earlier, and down 53,070 tonnes by 3.96% from 1,341,470 tonnes of the corresponding period last year. And the five-year (2015-2019) average at the same period is 1,390,200 tonnes.