I. Soybean

 

Price

 

Domestic soybean: Soybean sales is at a low pace in China’s producing regions as most farmers have strong sentiment of stalling sales, so that supply disruptions occur in the market. In addition, there is a sharp reduction in soybean production in regions around Jiangsu Province. New domestic soybean supplies are limiting, which highlights soybean quality and prices. Moreover, as imported soybean shipments are slow at ports due to strict commodity inspections, domestic soybean gradually takes a bigger share in the market, which also bolsters domestic soybean market. However, it is an established fact that new domestic soybeans will see an increase in production. And downstream farmers have little appetite for high-priced soybeans and choose to buy on immediate demand. In addition, China will also continue buying up U.S. soybeans, which will also affects domestic soybean market. In a hybrid of the bull and the bear, short-term domestic soybean market will maintain a strengthening trend in fluctuations. Farmers’ sales sentiment will be closely watched.

 

Imported soybean: Port traders continue raising prices for imported soybeans due to reducing supplies. However, port shipments have not recovered to a normal state, and purchasers tend to buy new domestic soybeans, so port shipments for imported soybeans are not satisfactory. Moreover, U.S. democratic candidate Joe Biden is expected to win the presidential election as he has won in the key swing states Michigan and Wisconsin. But no matter Joe Biden or Donald Trump, China will continue to fulfill the phase-one deal and buy U.S. soybeans as long as bilateral relations do not deteriorate. Imported soybean supplies will be increasing in China, which is negative to the market. In a hybrid of the bull and the bear, imported soybean market is predicted to steady. Participants can keep an eye on U.S. elections and soybean demand in China.

 

China's Soybean Weekly Price（CNY/Tonne）
Region		Grade	This week	Last week	Variation
Northeast China	Heilongjiang	Domestic, GB Grade 3	5140	5060	80
	Inner Mongolia	Domestic, GB Grade 3	5140	5000	140
	Heilongjiang	Imported, Russia	N/A	N/A
East China	Jiangsu	Domestic soybean	6900	6900	0
	Shandong	Imported, Argentina	N/A	N/A
		Imported, Brazil	4350-4650	N/A
		Imported, Uruguay	4800-4850	4550-4600	250
North China	Tianjin	Non-GM,Ethiopia	N/A	N/A
		Non-GM, Ukraine	N/A	N/A
		Non-GM,  Canada	N/A	N/A
		GM, PNW	N/A	N/A
		GM, U.S. GULF	N/A	N/A
National average		Domestic soybean	5140	5060	80
		Imported soybean	4130	4050	80

 

 

 

 

Crush: With a slight pickup in operation rates this week (Oct 31-Nov 6), soybean crush at domestic mills totals 2,095,580 tonnes (meal 1,655,508 tonnes and oil 398,160 tonnes), up 2,100 tonnes or 0.10% from 2,093,480 tonnes last week. Meanwhile, operation rates (capacity utilization) are 59.85%, up 0.06% from 59.79% in the previous week. Soybean crush is expected to rise to 2.12 mln tonnes and move to 2.15 mln tonnes in the next two weeks, respectively.

 

In the crop year of 2020/21 (from Oct 1st, 2020), China’s soybean crush totals 10,397,424 tonnes, up 1,862,974 tonnes or 21.83% from 8,534,450 tonnes a year earlier.

 

In the calendar year of 2020 (from Jan. 1st, 2020), China’s soybean crush amounts to 80,004,110 tonnes, up 9,427,975 tonnes or 13.36% from 70,576,135 tonnes of the corresponding period in 2019.

 

 

Inventory: Imported soybean stocks continue increasing in coastal regions this week, as more soybeans have been put into mills. In the week as of Nov 6, China’s imported soybean stocks in coastal regions total 5,978,400 tonnes, up 168,400 tonnes by 2.90% from 5,810,000 tonnes last week and up by 87.76% from 3,184,000 tonnes of the same period last year. Domestic soybean stocks usually decreased gradually from September in previous years, but China has purchased much more U.S. soybeans this year as a part of the trade deal, so it is necessary to focus on whether soybean crush would stay high.

 

 

Arrivals and the outlook: According to Cofeed, soybean arrivals are 22 cargoes with 1.415 mln tonnes this week, a total of 22 cargoes with 1.415 mln tonnes for November so far. The import is predicted to be 133 cargoes or 9.149 mln tonnes for November, 8.8 mln tonnes for December, and 7.5 mln tonnes for January and 6 mln tonnes for February.

 

II. Soybean Meal

 

Price: Domestic soybean meal prices swing to rise this week (Nov 2-6). As of this Friday, prices settle up 30-80 CNY at 3,220-3,320 CNY/tonne in domestic coastal regions. 

 

China's Soybean Meal Weekly Price  (CNY/Tonne)
Region		This week	Last week	Variation
Northeast China	Jilin	3,440	3,410	30
North China	Tianjin	3,310	3,270	40
	Hebei	3,310	3,270	40
Central China	Hubei	3,330	3,260	70
	Henan	3,440	3,350	90
East China	Shandong	3,265	3,205	60
	Jiangsu	3,230	3,170	60
	Zhejiang	3,230	3,170	60
	Shanghai	3,230	3,190	40
	Fujian	3,260	3,210	50
	Anhui	3,290	3,220	70
South China	Guangdong	3,220	3,160	60
	Guangxi	3,280	3,230	50
National average		3,268	3,222	46

 

 

Inventory: Soybean meal stocks continue decreasing this week due to quick deliveries, but the decline is small as soybean crush picks up to 2.09 mln tonnes. In the week as of Nov 6, China’s soybean meal stocks in coastal regions are 841,900 tonnes, down 13,200 tonnes by 1.54% from 855,100 tonnes last week but up by 104.29% from 412,100 tonnes of the corresponding period last year. As weekly soybean crush is predicted to stay above 2.10 mln tonnes in the next two weeks, soybean meal stocks may show a slight rise.

 

 

III. Soybean Oil

 

Price: Domestic soybean oil prices rise this week (Nov 2-6). As of this Friday, the price for GB Grade I settles at 7,830-7,910 CNY/tonne in domestic coastal regions, a rise of 190-320 CNY/tonne. The overall nationwide price index moves to 7,880 CNY/tonne, a weekly rise of 290 CNY or 3.82% from 7,590 CNY/tonne in the previous week.

 

China's Soybean Oil Weekly Price (CNY/Tonne)
Region		Grade	This week	Last week	Variation
South China	Guangzhou	GB Grade 1	7,860	7620	240
		GB Grade 3	N/A	N/A
North China	Qinhuangdao, Hebei	GB Grade 1	7,900	7,700	200
		GB Grade 3	7,800	7,600	200
	Tianjin	GB Grade 1	7830-7840	7,620	210-220
		GB Grade 3	N/A	N/A
East China	Rizhao, Shandong	GB Grade 1	7,870	7,540	330
		GB Grade 3	N/A	N/A
	Zhangjiagang, Jiangsu	GB Grade 1	7,910	7,590	320
		GB Grade 3	N/A	N/A
National average		GB Grade 1	7,880	7,590	290
		GB Grade 3	7,830	7,540	290

 

 

Inventory: Soybean oil stocks continue reducing this week in spite of a rise in soybean crush, as buyers from various fields still have strong demand and the consumption of soybean oil to replace its rivals and in feed has been increasing. In the week ending Nov 6, China’s soybean oil commercial inventories total 1,218,400 tonnes, down 32,800 tonnes by 2.62% from 1,251,200 tonnes last week, down 119,600 tonnes by 8.94% from 1,338,000 tonnes a month earlier, and up 34,050 tonnes by 2.87% from 1,184,350 tonnes of the corresponding period last year. And the five-year (2015-2019) average at the same period is 1,344,400 tonnes.