Today (Nov 6), 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 further rise by 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. It is expected that short-term cottonseed price will still move with fluctuations but toward an upward trend on the whole.

Oils: 

Summary: U.S. soybean futures continued rising on Thursday on brisk demand from China, dry weather conditions in Brazil and a weaker U.S. dollar. The weaker dollar came as the market saw a very possible outcome that democratic presidential candidate Joe Biden would win the election, which meant that the U.S. would have a larger-scale fiscal incentive. Oils futures continue moving higher on China’s Dalian Commodity Exchange today. In the spot markets, soybean oil goes up 80-120 CNY/tonne and palm oil up 30-40 CNY/tonne, both in tepid trade.

Malaysia’s Oct-ending palm oil stocks are tightening in the wake of a rise in exports and a decline in production. Moreover, the market talks that two Chinese state-owned enterprises will 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. Hence, fundamentals remain positive in oils market. Besides, the USDA is due to release its monthly report next week, and various agencies have lowered down their forecast for U.S. soybean production, in addition to a sharply weaker U.S. dollar and a continued global inflation expectation. Overall, the oils market is predicted to keep an uptrend in fluctuation. But the market is awaiting the outcome of the U.S. election, so macro-uncertainty could add to fluctuations in the market. Dalian oils futures narrow down gains in afternoon trade, so buyers can wait now in case of short-term fluctuations in the wake of sharp rises.

Soybean oil: GB Grade I soybean oil is mainly priced at 7,840-7,950 CNY/tonne in domestic coastal areas, a rise of 80-120 CNY/tonne. (Tianjin traders 7840; Rizhao traders 7900; Zhangjiagang traders 7950; and Guangzhou traders 7850). 

Palm oil: RBD palm olein is mainly priced at 6,840-6,920 CNY/tonne in coastal areas, mostly up 30-40 CNY/tonne. (Tianjin traders 6890, up 40; Rizhao 6920, up 30; Zhangjiagang traders 6840, up 40; Guangzhou traders 6840-6860, up 40; and Xiamen not available). 

Rapeseed oil: U.S. soybean futures further climbed on Thursday, but rapeseed oil futures move lower after opening higher on China’s Zhengzhou Commodity Exchange today. Spot rapeseed oil prices go down 90-110 CNY to 10,270-10,340 CNY/tonne in coastal regions in tepid trading.

The market sees a very possible outcome that democratic presidential candidate Joe Biden will win the election, and if so, the U.S. and China may see a detente in relations and HUAWEI Meng Wanzhou will probably be released. But it will take days for the outcome to go public, so macro-uncertainty is likely to add to fluctuations in the market, and Zhengzhou rapeseed oil futures thus fluctuate to decline toward the midday trade. However, China’s rapeseed import is affected by tension with Canada, so that rapeseed crush remains small and rapeseed oil stocks are only 257,000 tonnes at present. Meanwhile, China’s soybean oil and palm oil stockpiles are also not at high levels. And there is a rise in demand from feed this year. Hence, there is no pressure in oils supplies, which also bolsters rapeseed oil to stay at the high level. Buyers can wait for the moment.

Cottonseed oil: Cottonseed oil prices steadily increase by 50-200 CNY/tonne today.  U.S. soybean futures soared on Thursday on China’s robust demand and prolonged dryness in Brazil crop area. US dollars go weak as market expects that Joe Biden is nearing to victory of the U.S. presidential election followed by more fiscal stimulus. Oil futures continue rising on China’s Dalian Commodity Exchange today. In the cash market, soybean oil up by 80-120 CNY/tonne and palm oil up by 30-40 CNY/tonne. Besides, palm oil stocks in late October are tightening. Moreover, soybean oil stocks continue falling to 1.25 mln tonnes with a decrease of 1.7% from a week earlier as the demand remains good. Thus, oil fundamentals remain good. Additionally, the bulk oils market will keep strengthening against the backdrop of global inflation expectations. On the other side, cottonseed crushing mills keep facing losses as cottonseed is still pricey, so they intend to prop up prices. It is predicted that short-term cottonseed oil market will stay strong at the high level.

(USD $1=CNY ¥6.63)