Today (Nov 18), the market for oilseeds and oils in China is shown as follows:

Oilseeds:

Imported soybean: U.S. Gulf soybeans are offered at 4,850-4,900 CNY/tonne and Uruguayan soybeans at 4,900-4,950 CNY/tonne at Shandong port today. Domestic purchasers tend to choose domestic soybeans and have little appetite for imported soybeans. And U.S. democratic candidate Joe Biden won the presidential election, which will make for a detente in relations between China and the US. In addition, China is still purchasing soybeans from the U.S. and Brazil, which will increase the arrivals at ports and thus be negative to imported soybean market. However, imported soybeans are in tight supplies, in addition to strict commodity inspections at ports, which is bolstering the market. Overall, short-term imported soybean market is predicted to steady.

Cottonseed: Cottonseed prices decrease by 0.02-0.05 CNY/kg in several 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 cottonseed price will fluctuate narrowly in a short term.

Oils: 

Summary: U.S. soybean futures surged to a four-year high on Tuesday, bolstered by strong U.S. soybean exports and on sustained dryness in some portions of South America as La Nina continued. Oils futures continue rising but actually stay below the previous close on China’s Dalian Commodity Exchange today. In the spot markets, soybean oil fluctuates by 30-70 CNY/tonne and palm oil down 40-70 CNY/tonne, both in tepid trade.

China’s soybean oil stocks are still declining even under high soybean crush, and palm oil and rapeseed oil stockpiles are also low. Meanwhile, Malaysia’s palm oil inventories also fell to a low level of 1.57 mln tonnes by the end of October, and will probably continue falling if by current production and export pace. Besides, strong U.S. soybean prices are also lifting import cost. Overall, oils market is predicted to keep a strengthening trend, but if oils futures adjust at high levels after climbing higher, short-term market may also see adjustments but with limited space.

Soybean oil: GB Grade I soybean oil is mainly priced at 8,150-8,180 CNY/tonne in domestic coastal areas, fluctuating by 30-70 CNY/tonne. (Tianjin traders 8160-8170; Rizhao traders 8180; Zhangjiagang traders 8180; and Guangzhou traders 8150-8180). 

Palm oil: RBD palm olein is mainly priced at 6,930-7,060 CNY/tonne in coastal areas, mostly down 40-70 CNY/tonne. (Tianjin traders 7010-7030, down 40; Rizhao 7060, down 70; Zhangjiagang traders 6980, down 70; Guangzhou traders 6930, down 60; and Xiamen not available). 

Rapeseed oil: U.S. soybean futures rose to hit a fresh four-year high on Tuesday on strong export demand, and rapeseed oil futures are moderately higher on China’s Zhengzhou Commodity Exchange today. Spot rapeseed oil prices go up 20 CNY to 10,210-10,360 CNY/tonne in coastal regions in tepid trading. 

China’s rapeseed oil stocks are only 213,000 tonnes at present, and soybean oil and palm oil stocks are also at low levels. Meanwhile, there is no pressure in oils supplies due to a rise in demand from feed this year. But the consumption of rapeseed oil is also affected by its huge price spread with soybean oil and palm oil. Overall, rapeseed oil prices will probably stay at high levels, but there is mainly rigid demand in the market due to dismal value-to-price ratio.

Cottonseed oil: Cottonseed oil prices get another increase of 50-100 CNY/tonne in some regions today. U.S. soybean futures soared to a new four-year high on Tuesday on strong export and prolonged dryness in some regions of South America incurred by La Nina. It will see a consecutive decrease in soybean oil stocks despite super high level of soybean crush. Also, the inventory of palm oil and rapeseed oil stays relatively low. Malaysian palm oil stocks in late October descended to a low of 1.57 mln tonnes. Furthermore, US soybean stages strong performance, pulling up the cost of importing soybean. Bulk oils market will keep strengthening overall. Additionally, 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 still stay strong at the high level.

Sunflower oil: Sunflower oil prices are stable with a partial rise of 100 CNY/tonne in China today. Grade I imported sunflower oil is offered at 9,800-10,400 CNY/tonne; crude sunoil is offered at 9,300-9,600 CNY/tonne.

China’s soybean oil stocks are still declining even under high soybean crush, and palm oil and rapeseed oil stockpiles are also low. Besides, sunflower oil prices remain high in foreign markets, in addition to a production reduction in sunflowerseed. These are support sunflower oil prices to continue rises. Domestic milers are supporting sunflower oil prices, which is good to the market. But domestic downstream buyers are cautious now due to high sunflower oil prices, which is negative to the market. Overall, short-term sunflower oil market is predicted to continue a strong trend on bullish factors.

Corn oil: Corn oil prices are mostly stable with a partial decline in China today. Grade I corn oil is offered at 10,000-10,500 CNY/tonne, down 200 CNY/tonne. (Shandong 10,300-10,500 CNY/tonne; Hebei 10,200; Liaoning 10,000, down 200 CNY/tonne; Sichuan 10,100); crude corn oil is offered at 8,300-8,600 CNY/tonne. (Hebei 8350-8600 CNY/tonne; Henan 8500; Inner Mongolia 8300).

China’s corn oil prices remain at a high level, which is bearish to the market. Meanwhile, the supply of corn oil is also increasing due to a pickup in operation rates, whilst downstream buyers are slow in taking delivery due to dismal demand in the market. These are cracking down spot corn oil prices. But millers are propping up prices due to high cost. Overall, short-term corn oil market is predicted to decline to adjust but also to keep a strengthening trend in fluctuation.

(USD $1=CNY ¥6.56)