Today (Oct 28), 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 mainly keep steady and individually decline by 0.02 CNY/kg 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 and the downward space is limited. 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 a narrow range.

Oils: 

Summary: U.S. soybean futures snapped an uptrend to decline on Tuesday, as U.S. soybean harvests were 83% completed, compared to 57% last year, and Brazil’s producing regions also embraced favorable rains recently. And oils futures also fall on China’s Dalian Commodity Exchange today. In the spot markets, soybean oil mostly goes down 20-50 CNY/tonne and palm oil steadily up 10 CNY/tonne, probably attracting some low-level purchases.

Dalian oils futures are adjusting after gains in several consecutive sessions, but the downside is limited. China’s soybean oil stocks are declining owing to strong demand. And Indonesia officially issues an announcement that the country will continue adjusting palm oil export tariffs to support the sustaining implementation of B30 plan. Besides, Malaysia’s palm oil production has also fallen. Hence, the market holds strong sentiment to prop up prices. Overall, the oils market is predicted to have limited declines and keep an uptrend with fluctuations. But due to the impact of the COVID-19 in Europe, the fund-driven market will fluctuate frequently.

Soybean oil: GB Grade I soybean oil is mainly priced at 7620-7710 CNY/tonne in domestic coastal areas, a decline of 20-60 CNY/tonne. (Tianjin traders 7620; Rizhao traders 7630; Zhangjiagang traders 7680-7700; and Guangzhou traders 7700-7710). 

Palm oil: RBD palm olein is mainly priced at 6570-6770 CNY/tonne in coastal areas, a partial rise of 10 CNY/tonne. (Tianjin traders 6700, flat; Rizhao 6770, flat; Zhangjiagang traders 6670, up 10; Guangzhou traders 6570-6600, up 10; and Xiamen not available). 

Rapeseed oil: U.S. soybean futures closed lower on Tuesday, and rapeseed oil futures fluctuate to decline on China’s Zhengzhou Commodity Exchange today. Spot rapeseed oil prices go down 10-20 CNY to 9,760-9,900 CNY/tonne in coastal regions in tepid trading.

China’s soybean crush continued rising to over 2.19 mln tonnes last week due to huge soybean supplies, which is dragging down rapeseed oil market. But 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. In addition, the demand for oils in feed also grows this year, so there is no pressure in oils supply. Overall, rapeseed oil market is predicted to have limited declines and remain at the high level.

Cottonseed oil: Cottonseed oil prices mainly keep steady and fluctuate by 50-100 CNY/tonne in some regions today. Soybean oil stocks fall on better demand. Indonesia will continue revising palm oil export levy to support B30 programme, said Indonesia’s official announcement. And Malaysian palm oil production goes down. In this case, marketers have strong intention to prop up price. In addition,  the cost of importing soybean has been pushed up by continuous rise in US soybean. Plus, buyers tend to take a bargain hunting due to existing global inflation expectations. For these reasons, the overall bulk oils market still towards an uptrend. 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. Therefore, short-term cottonseed oil price may fluctuate at the high level following soybean oil.

(USD $1=CNY ¥6.72)