Today (Nov 2), the market for oilseeds and oils in China is shown as follows:

Oilseeds:

Imported soybean: Uruguayan soybean is offered at 4,800-4,850 CNY/tonne at Shandong port today, up 250 CNY/tonne from last Friday. The supply of imported soybeans is gradually decreasing, which is bullish to 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 steady.

Cottonseed: Cottonseed prices mainly steadily decline by 0.01-0.04CNY/kg today. 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. Besides, cottonseed output this year is lower than the previous year, which supports cottonseed market. Considering that cottonseed oil and cottonseed meal are both paring gains, short-term cottonseed price is predicted to move with fluctuations.

Oils: 

Summary: US soybean futures rose last Friday as strong export demand tightened supplies, but oils futures fluctuate to decline on China’s Dalian Commodity Exchange today. In the spot markets, soybean oil and palm oil go down 20-40 CNY/tonne, both in tepid trade.

The market has strong sentiment for risk aversion ahead of the results of the U.S. presidential elections this Thursday, so domestic and foreign futures markets are both in the correction territory. But China’s soybean crush declined by 4.7% weekly to 2.09 mln tonnes last week as some mills suspended production for swelling meal inventories, and soybean oil stocks continued falling 1.7% to 1.25 mln tonnes due to the demand from feed industry. Besides, China’s rapeseed oil adn palm oil stocks are also at low levels. Owing to bullish fundamentals, the oils market is predicted to have little downside space and and to maintain an uptrend in fluctuation. But it’s worth noting that international crude oil price slumped to 34.54 USD/barrel, a decline of 7.36 USD from Oct 20, as several European countries reinstated lockdown to combat the resurgence of the coronavirus. In addition, one Chinese state-owned company bought 40,000 tonnes of soybean oil from Argentine for shipments in May-June due to profitable import margins. These are likely to add to fluctuations in the market. Participants are suggested to remain cautious.

Soybean oil: GB Grade I soybean oil is mainly priced at 7,500-7,610 CNY/tonne in domestic coastal areas, a decline of 20-30 CNY/tonne. (Tianjin traders 7500-7520; Rizhao traders 7570; Zhangjiagang traders 7570; and Guangzhou traders 7590-7610).  

Palm oil: RBD palm olein is mainly priced at 6,520-6,640 CNY/tonne in coastal areas, down 30-40 CNY/tonne. (Tianjin traders 6610, flat; Rizhao 6640, down 40; Zhangjiagang traders 6590, down 30; Guangzhou traders 6520, down 40; and Xiamen not available). 

Rapeseed oil: U.S. soybean futures closed higher last Friday, and rapeseed oil futures open high and rise on China’s Zhengzhou Commodity Exchange today. Spot rapeseed oil prices go up 50-150 CNY to 10,180-10,320 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. In the week as of October 30^th, China’s rapeseed oil stocks fell 9.2% weekly to 257,000 tonnes, and soybean oil stocks slightly dropped by 1.7% to 1.25 mln tonnes. Actually, the demand for oils in feed posts a huge growth this year. Hence, there is no pressure in supply, which is bolstering rapeseed oil market. But international crude oil prices have slumped on new lockdown in Europe and results of U.S. presidential election will come out this Thursday, so commodity markets broadly decline on risk aversion. This may drag down rapeseed oil market and add more fluctuations.

Cottonseed oil: Cottonseed oil prices are mixed in several regions with a fluctuation of 50-100 CNY/tonne. A few soy crushing mills have halted the operation due to bloat inventory of soybean meal. In this case, soybean crush declines by 4.7% to 2.09 mln tonnes. And soybean oil stocks continue falling to 1.25 mln tonnes with a decrease of 1.7% from a week earlier as the demand from feed industry goes better. Also, the inventory of rapeseed oil and palm oil stays at a low level. Thus, oil fundamentals remain good. On the other side, cottonseed crushing mills keep facing losses as cottonseed is still pricey, 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, global crude oil plunged on account of the second wave of COVID-19 outbreak in U.S.. Oil futures fluctuate to lower on China’s Dalian Commodity Exchange today. And soybean oil and palm oil are both down 20-40 CNY/tonne in the cash market. This has weighed on cottonseed oil market. Nevertheless, the overall oils market will still move higher with fluctuations against the backdrop of global inflation expectations, and short-term cottonseed oil market will fluctuate at the high level.

(USD $1=CNY ¥6.71)