Today (Nov 5), 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. 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 fluctuate by 0.01-0.02 CNY/kg in some regions 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 but toward an upward trend on the whole.

Oils: 

Summary: La Nina continued threatening crops in South America as recent rains in Brazil could not completely ease pressure in soybean crop development; and U.S. soybean stocks was tightening, and the USDA was expected to lower down U.S. soybean yield while raise exports in November supply and demand report; hence, U.S. soybean futures climbed on Wednesday. But oils futures slow down gains on China’s Dalian Commodity Exchange today, as funds have some sentiment to reduce high-level positions on macro-uncertainty and ahead of climbing to another high point. In the spot markets, soybean oil goes up 10-70 CNY/tonne and palm oil up 80-100 CNY/tonne, and the trade is predicted to be tepid.

The market forecasts that Indonesia will sharply hike export duties, and Malaysia’s October-ending palm oil stocks could have fallen to 1.60 mln tonnes. Moreover, two leading state-owned enterprises are expected to start purchases in the first quarter next year, and China’s soybean oil stocks have fallen 1.7% weekly to 1.25 mln tonnes due to strong demand at low levels. Therefore, short-term oils market is predicted to keep a strengthening trend on bullish fundamentals. But the Europe is again in the centre of the coronavirus. Moreover, U.S. democratic presidential candidate Joe Biden currently has 264 electoral votes, which is one step left to the magic number of 270 votes. People call this an astonishing reversal, as the situation just did not bode well for him yesterday afternoon. The outcome of the presidential election will remain unresolved for days, so macro-uncertainty could add to fluctuations in the market. Hence, participants still need to be cautious.

Soybean oil: GB Grade I soybean oil is mainly priced at 7,750-7,850 CNY/tonne in domestic coastal areas, a rise of 10-70 CNY/tonne. (Tianjin traders 7800-7830; Rizhao traders 7750; Zhangjiagang traders 7870; and Guangzhou traders 7850). 

Palm oil: RBD palm olein is mainly priced at 6,840-6,920 CNY/tonne in coastal areas, mostly up 80-100 CNY/tonne. (Tianjin traders 6880-6910, up 100; Rizhao 6920, up 80; Zhangjiagang traders 6860, up 100; Guangzhou traders 6840, up 100; and Xiamen not available). 

Rapeseed oil: U.S. soybean futures climbed on Wednesday. Democratic presidential candidate Joe Biden currently has 264 electoral votes, which nears the magic number of 270 votes. People call this an astonishing overturn, as the situation just did not bode well for him yesterday afternoon. Joe Biden’s election as president could offer a thaw to relations between China and the U.S., and then HUAWEI Meng Wanzhou may be released. Hence, rapeseed oil futures solely decline on China’s Zhengzhou Commodity Exchange today due to the exit of funds. Spot rapeseed oil prices go down 90-110 CNY to 10,270-10,340 CNY/tonne in coastal regions in tepid trading. But China’s rapeseed crush is low and rapeseed oil stocks are only 257,000 tonnes in coastal regions now, so there is no pressure in supply. Overall, short-term rapeseed oil market is predicted to have limited downside space and to stay at the high level.

Cottonseed oil: Cottonseed oil prices keep steady today. Crop condition in South America is affected by La Nina. And USDA will lower US soybean yield forecast and revise export data upward in November supply and demand report. Consequently, U.S. soybean futures soared on Wednesday. And oil futures slow gains on China’s Dalian Commodity Exchange today. In the cash market, soybean oil up by 10-70 CNY/tonne and palm oil up by 80-100 CNY/tonne. Besides, Malaysia’s palm oil production in late October is likely to slide to 1.60 mln tonnes. Moreover, 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. Thus, oil fundamentals remain good. Additionally, the overall oils market will still move higher with fluctuations against the backdrop of global inflation expectations. 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. It is predicted that short-term cottonseed oil market will fluctuate at the high level.

(USD $1=CNY ¥6.69)