Today (Oct 27), the market for oilseeds and oils in China is shown as follows:

Oilseeds:

Imported soybean: Brazilian soybean is offered at 4,300 CNY/tonne and US Gulf soybean at 4,650 CNY/tonne at Shandong port today. Traders are unable to ship out soybeans due to strict inspections.  The supply of imported soybeans is gradually decreasing, which is supporting the market. But the influx of new domestic soybeans is entering the market, and the quality is also improving, so that purchasers turn to choose domestic soybeans. Besides, some port traders offer very high prices for imported soybeans, which also dwindles the market appetite. Overall, short-term imported soybean market is predicted to be little changed.

Cottonseed: Cottonseed prices keep steady and decline by 0.01-0.05 CNY/kg in several regions today. Cottonseed output this year has decreased compared with the previous year. And both cottonseed oil and cottonseed meal are keeping strengthening for the moment. Thus, cottonseed market is supported. Besides, the delivery of cottonseed is still under impact of the COVID-19 outbreak in Xinjiang. Moreover, cottonseed crushing mills keep facing losses as cottonseed price remains too high, and some mills have halted the purchase and have intention to force price down. It is expected that short-term cottonseed market may fluctuate at the high level.

Oils: 

Summary: U.S. soybean futures advanced to hit a four-year peak on Monday on strong demand from China. Oils futures continue rising on China’s Dalian Commodity Exchange today. In the spot markets, soybean oil and palm oil go up 20-40 CNY/tonne. The overall trade is predicted to be tepid, but with some purchases on low-level basis.

China’s soybean oil stocks drop unexpectedly on brisk demand, though soybean crush rose to 2.2 mln tonnes. The rumor that Indonesia will hike tariff to safeguard the implementation of B30 also fuels export offers to move higher. Besides, Malaysia’s palm oil production in Oct 1-25 is reported to decline 14% from a month earlier, compared to a decline of 9.95% in Oct 1-20. In addition, the cost of importing soybeans is rising, and a global inflation expectation is in focus, so that oil mills show strong sentiment to lift prices. Overall, the oils market is predicted to keep a strengthening trend. But due to the impact of the COVID-19 in Europe, the fund-driven market will fluctuate frequently, so participants need to keep good balance of selling and buying.

Soybean oil: GB Grade I soybean oil is mainly priced at 7,630-7,760 CNY/tonne in domestic coastal areas, mostly up 20-30 CNY/tonne. (Tianjin traders 7630; Rizhao traders 7660; Zhangjiagang traders 7700; and Guangzhou traders 7760). 

Palm oil: RBD palm olein is mainly priced at 6,570-6,740 CNY/tonne in coastal areas, mostly up 20-40 CNY/tonne. (Tianjin traders 6670, up 30; Rizhao 6740, up 40; Zhangjiagang traders 6630, up 40; Guangzhou traders 6570, up 20; and Xiamen not available).

Rapeseed oil: U.S. soybean futures advanced to hit a four-year peak on Monday on strong demand from China, and oils futures also slow down rises on China’s commodity exchanges. Spot rapeseed oil prices go up by 10-20 CNY to 9,780-9,920 CNY/tonne in coastal regions in tepid trading.

China’s rapeseed crush remains low as its imports are limited amid tensions between Beijing and Ottawa, and oil mills are mainly carrying out rapeseed oil contracts. Domestic rapeseed oil stocks are 284,000 tonnes and soybean oil at 1.27 mln tonnes at present. In addition, the demand for oils in feed also grows this year, so there is no pressure in oils supply. But China’s soybean crush may stay high at 2.15 mln tonnes this week due to huge soybean arrivals at ports, and the demand for rapeseed oil has also been affected by its big price spread with rapeseed oil and soybean oil. Overall, rapeseed oil market is predicted to keep strengthening at the high level with fluctuations.

Cottonseed oil: Cottonseed oil prices mainly keep steady and fluctuate by 50-100 CNY/tonne in some regions today. U.S. soybean futures rose on Monday and recorded a four-year high on China’s brisk demand. Oil futures continue increasing on China’s Dalian Commodity Exchange today, and soybean oil and palm oil mostly settle 20-40 CNY/tonne higher on the spot market. In addition, and the cost of importing soybean has been pushed up by continuous rise in US soybean. Plus, oil mills tend to prop up prices due to existing global inflation expectations. For these reasons, the overall bulk oils market still keeps strengthening. On the other side, cottonseed crushing mills keep facing losses as cottonseed price remains too high now, and many mills have halted the purchase. Consequently, the operation rate still stays at a low level, which will continue underpinning cottonseed oil market. Nevertheless, market participants are cautious in raising price due to slack demand for Xinjiang cottonseed oil. Therefore, short-term cottonseed oil price may fluctuate at the high level following soybean oil.

(USD $1=CNY ¥6.70)