Today (Oct 29), the market for oilseeds and oils in China is shown as follows:

Oilseeds:

Imported soybean: Uruguayan soybean is offered at 4,550-4,600 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. Overall, short-term imported soybean market is predicted to be little changed.

Cottonseed: Cottonseed prices mainly steadily decline by 0.02-0.05 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: The uptick coronavirus cases had led France and Germany to reinstate strict lockdown measures, in addition to the risk aversion ahead of the US election on November 3, so the Dow Jones and the S&P 500 just experienced their largest losses in more than fourth months on Wednesday. Meanwhile, U.S. soybean futures and crude oil prices both tumbled as Brazilian soybean producing regions embraced favorable rains and U.S. crude oil stocks posted a larger-than-expected rise. And oils futures also move low on China’s Dalian Commodity Exchange today. In the spot markets, soybean oil prices decline by 30-110 CNY/tonne and palm oil down 60-100 CNY/tonne, both in tepid trade.

Domestic oils market has relatively strong fundamentals as soybean oil and rapeseed oil stocks are both at low levels, so domestic oils futures see smaller losses than foreign markets today. Moreover, Malaysia’s palm oil sees a decline in production and strong exports, and India is mulling lower down import duties of vegetable oils to expand imports. Meanwhile, Canada held a court again on the extradition of Meng Wanzhou, which also bolsters the market sentiment and makes rapeseed oil futures buck the trend to rise today. It can be seen that the oils market still has strong support now, so it will hopefully climb to keep an uptrend with fluctuations after a round of declines. Buyers can wait for low and stable prices to make appropriate replenishment.

Soybean oil: GB Grade I soybean oil is mainly priced at 7,520-7,650 CNY/tonne in domestic coastal areas, a decline of 30-110 CNY/tonne. (Tianjin traders 7520-7550; Rizhao traders 7570; Zhangjiagang traders 7590; and Guangzhou traders 7650). 

Palm oil: RBD palm olein is mainly priced at 6,570-6,700 CNY/tonne in coastal areas, down 60-100 CNY/tonne. (Tianjin traders 6640-6650, down 90; Rizhao 6700, down 100; Zhangjiagang traders 6620, down 80; Guangzhou traders 6570, down 60; and Xiamen not available). 

Rapeseed oil: U.S. soybean futures closed further lower on Wednesday as coronavirus cases surged in Europe and United States. But rapeseed oil futures buck the trend to climb on China’s Zhengzhou Commodity Exchange today on tightening stocks and as Ottawa held a court again on the extradition of Meng Wanzhou, chief financial officer of Chinese telecom giant Huawei Technologies Co Ltd. Spot rapeseed oil prices go up 40-60 CNY to 9,800-10,000 CNY/tonne in coastal regions in tepid trading.

China’s lower rapeseed imports due to tensions with Canada keep the crush at a low level, so that domestic mills are mainly carrying out rapeseed oil contracts. China’s rapeseed oil stocks are only 284,000 tonnes now, a sharp decline of 37.4% from a year earlier. And its soybean oil inventories have also fallen to 1.27 mln tonnes. Actually, the demand for oils in feed posts a huge growth this year. Hence, there is no pressure in supply, which is supporting rapeseed oil market. But China’s soybean crush is predicted to stay high above 2.15 mln tonnes this week, and due to its widening price spread with soybean oil and palm oil, rapeseed oil is in lower consumption. Overall, rapeseed oil market is predicted to keep strengthening at the high level with some fluctuations.

Cottonseed oil: Cottonseed oil prices mainly keep steady and fluctuate by 100-200 CNY/tonne in some regions today. The demand for cottonseed oil is good at the moment, and oil consumption for feed grows substantially this year. In this case, there is no pressure on oils supply, and crushing mills bull the oils market outlook, supporting cottonseed oil market. Besides, 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. In addition, U.S. soybean and crude oil slumped on Wednesday on a surge in COVID-19 new cases. Oil futures on China’s Dalian Commodity Exchange move lower today. In the cash market, soybean oil drops by 30-110 CNY/tonne, and palm oil falls by 60-100 CNY/tonne. But the overall bulk oils market is still trending up under volatility, so short-term cottonseed oil price may fluctuate at the high level.

(USD $1=CNY ¥6.73)