I. Soybean

 

Price

 

Domestic soybean: The market is in tight supply currently as most soybean producers are selling at a slow pace, in addition to a sharp reduction in soybean production around Jiangsu Province. This highlights a premium in soybean quality and price on the market now. Moreover, imported soybean shipments are also constrained by strict commodity inspection, which gradually grants market share to domestic soybeans and thus bolsters domestic soybean market. However, financial pressure gradually comes close to the end of the year, so that some traders have undercut prices to recoup funds. Add to that, market entities and food manufacturers are slowing down purchases to lower down cost for fear of high prices, which is also negative to domestic soybean market. In a hybrid of the bull and the bear, short-term domestic soybean prices will maintain a strengthening trend in fluctuation on bullish factors, and farmers’ sales pace will be closed watched.

 

Imported soybean: Port traders continue raising prices for imported soybeans due to tight supplies. However, port shipments have been constrained by strict commodity inspection, and purchasers tend to buy new domestic soybeans, so port shipments for imported soybeans are not satisfactory. Moreover, China is still fulfilling its phase-one trade deal, and has also started to sign forward contracts with Brazilian exporters due to good crush margins, which will add to supply on the market. Overall, short-term imported soybean market is predicted to keep firm on tightening supplies. Participants can continue focusing on the outcome of presidential elections in the U.S. and imported 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	5240	5140	100
	Inner Mongolia	Domestic, GB Grade 3	5740	5140	600
	Heilongjiang	Imported, Russia	N/A	N/A
East China	Jiangsu	Domestic soybean	6900	6900	0
	Shandong	Imported, Argentina	N/A	N/A
		Imported, Brazil	N/A	4350-4650
		Imported, Uruguay	4980	4800-4850	130-180
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	5240	5140	100
		Imported soybean	4160	4130	30

 

 

 

 

Crush: As millers continue raising operation rates this week (Nov 7-13), soybean crush at domestic mills totals 2,120,080 tonnes (meal 1,674,863 tonnes and oil 402,815 tonnes), up 24,500 tonnes or 1.17% from 2,095,580 tonnes last week. Meanwhile, operation rates (capacity utilization) are 60.55%, up 0.7% from 59.85% in the previous week. Soybean crush is expected to rise to 2.13 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 12,517,504 tonnes, up 2,347,954 tonnes or 23.09% from 10,169,550 tonnes a year earlier.

 

In the calendar year of 2020 (from Jan. 1st, 2020), China’s soybean crush amounts to 82,124,190 tonnes, up 9,912,955 tonnes or 13.73% from 72,211,235 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 13, China’s imported soybean stocks in coastal regions total 6,064,400 tonnes, up 86,000 tonnes by 1.44% from 5,978,400 tonnes last week and up by 95.27% from 3,105,600 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 32 cargoes with 2.075 mln tonnes this week, a total of 55 cargoes with 3.555 mln tonnes for November so far. The import is predicted to be 133 cargoes or 9.149 mln tonnes for November, 9.1 mln tonnes for December, and 8 mln tonnes for January, 6 mln tonnes for February and 6.5 mln tonnes for March.

 

II. Soybean Meal

 

Price: Domestic soybean meal prices fluctuate to decline this week (Nov 9-13). As of this Friday, prices settle down 50-90 CNY at 3,080-3,230 CNY/tonne in domestic coastal regions. 

 

China's Soybean Meal Weekly Price  (CNY/Tonne)
Region		This week	Last week	Variation
Northeast China	Jilin	3,350	3,440	-90
North China	Tianjin	3,230	3,310	-80
	Hebei	3,230	3,310	-80
Central China	Hubei	3,200	3,330	-130
	Henan	3,330	3,440	-110
East China	Shandong	3,160	3,265	-105
	Jiangsu	3,130	3,230	-100
	Zhejiang	3,135	3,230	-95
	Shanghai	3,150	3,230	-80
	Fujian	3,170	3,260	-90
	Anhui	3,140	3,290	-150
South China	Guangdong	3,080	3,220	-140
	Guangxi	3,180	3,280	-100
National average		3,172	3,268	-96

 

 

Inventory: Soybean meal stocks increase this week as soybean crush continues rising to 2.12 mln tonnes. In the week as of Nov 13, China’s soybean meal stocks in coastal regions are 870,300 tonnes, up 28,400 tonnes by 3.37% from 841,900 tonnes last week and up by 145.08% from 355,100 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 are likely to continue slight rises.

 

 

III. Soybean Oil

 

Price: Domestic soybean oil prices climb for a third consecutive week this week (Nov 9-13). As of this Friday, the price for GB Grade I settles at 7,910-8,010 CNY/tonne in domestic coastal regions, a rise of 40-120 CNY/tonne. The overall nationwide price index moves to 7,950 CNY/tonne, a weekly rise of 70 CNY or 0.88% from 7,880 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	7980-8010	7,860	120-150
		GB Grade 3	N/A	N/A
North China	Qinhuangdao, Hebei	GB Grade 1	7,950	7,900	50
		GB Grade 3	7,850	7,800	50
	Tianjin	GB Grade 1	7,910	7830-7840	70-80
		GB Grade 3	N/A	N/A
East China	Rizhao, Shandong	GB Grade 1	7,960	7,870	90
		GB Grade 3	N/A	N/A
	Zhangjiagang, Jiangsu	GB Grade 1	7,990	7,910	80
		GB Grade 3	N/A	N/A
National average		GB Grade 1	7,950	7,880	70
		GB Grade 3	7,945	7,830	115

 

 

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. In the week ending Nov 13, China’s soybean oil commercial inventories total 1,179,100 tonnes, down 39,300 tonnes by 3.23% from 1,218,400 tonnes last week, down 140,900 tonnes by 10.67% from 1,320,000 tonnes a month earlier, and up 44,100 tonnes by 3.89% from 1,135,000 tonnes of the corresponding period last year. And the five-year (2015-2019) average at the same period is 1,325,200 tonnes.