Today (Nov 19), the market for meals in China is shown as follows:

Soybean meal: U.S. soybean futures rose to a fresh four-year peak on Wednesday, bolstered by tight global vegetable oils supplies, and dryness and concerns over a delay in soybean harvest in South America, alongside market enthusiasm for a quicker recovery in global economy as the drug maker Pfizer said its coronavirus vaccine is 95% effective in final clinical trial data. But meal futures fluctuate to post only slight gains and actually stay below the previous close on China’s Dalian Commodity Exchange today, constrained by the arbitrage of buying oils and selling meals. Spot soybean meal prices fluctuate by 10-20 CNY to 3,100-3,240 CNY/tonne in coastal region in tepid trade. (Tianjin 3240, Shandong 3150-3200, Jiangsu 3110-3130, Dongguan 3100-3200, and Guangxi 3170-3200.)  

Soybean crush margins are at a loss on Dalian due to growing import cost, and soybean meal has a bright demand outlook due to a sustained recovery in hog herd, which together support meal prices. However, soybean stocks are huge in China now, and Chinese crushers are maintaining high soybean crush to guarantee oils supply, as oils are in strong performance. Moreover, domestic aquaculture is fading as the weather gets cool. Hence, domestic soybean meal stocks rose 3.4% weekly to 870,000 tonnes, and some millers have to quicken up deliveries now. This is curbing the upside space of soybean meal prices. Overall, short-term soybean meal is predicted to follow futures to keep range-bound.

Imported rapeseed meal: Market expected an acceleration of global economic recovery as Pfizer Inc said on Wednesday that final results from the late-stage trial of its COVID-19 vaccine showed it was 95% effective, boosting market sentiment. And soybean oil price jumps higher due to short supply of global vegetable oil. Moreover, U.S. soybean futures closed up and record a four-year high on tightening inventories amid strong exports underpinned by dryness in parts of South America and concerns over delaying harvest in early 2021. Meal futures in China also fluctuate to go up today. And rapeseed meal price in coastal regions settles up 10-20 CNY/tonne at 2,440-2,500 CNY/tonne, seeing a light trading. For rapeseed crush stays at a low level amid tensions between Canada and China, rapeseed meal is in tight supply, which may boost rapeseed meal price. However, oils stage strong performance and investors take profit from oil buying and meal selling. Additionally, aquaculture is gradually entering into an off season, leading to a rally in soybean meal stocks. This may limit price rises of rapeseed meal. Consequently, rapeseed meal market is projected to fluctuate to stay strong.

Imported fishmeal: Imported fishmeal prices steady today and can be traded through negotiation. Peruvian Standard SD with 65% protein content is 9,800-10,100 CNY/tonne; Peruvian higher-quality SD with 65% protein content is 10,200-10,500 CNY/tonne; Peruvian higher-quality SD with 67% protein content is 10,700-11,000 CNY/tonne; and Peruvian Super Prime SD with 68% protein content is 11,200-11,400 CNY/tonne. Domestic aquaculture is entering into the slack season as the weather gets cool, so that its demand for fishmeal is decreasing and feed companies are not purchasing at a brisk pace. In addition, fish catches are smooth in Peru now, so that domestic traders have weaker sentiment in propping up prices. But domestic port traders are not willing to offer at lower prices as there is no pressure in stocks, and some are waiting for new offers from Peruvian market. Overall, domestic fishmeal prices are expected to post a weakening trend in the near term.

Stocks at ports: Huangpu 64,500 tonnes, Fuzhou 12,360 tonnes, Shanghai 31580 tonnes, Tianjin 550 tonnes, Dalian 6,700 tonnes, Fangchenggang 1,300 tonnes and 4,250 tonnes at other ports.

FOB quotes from foreign markets today: Dec/Jan shipments are quoted steadily at 1,280 USD/tonne for Peruvian Standard with 65% protein content and at 1,510 USD/tonne for Peruvian super with 68% protein content. Chilean Standard with 65% protein content is quoted steadily at 1,370 USD/tonne, and super with 68% protein content at 1,600 USD/tonne.

Fish catches in north-central Peru: As of Nov 17 (local time), fish catches in the second season of 2020 total 259,863 tonnes, taking up 9.35% of the total quota of 2.78 mln tonnes and with the fishing average at around 43, 000 tonnes per day and 2,520,137 tonnes remaining available.

Cottonseed meal: Cottonseed meal prices further decrease by 20-50 CNY/tonne in some regions today. The demand for oils remains good, so investors take profit from oils buying and meals selling. Besides, aquaculture has entered into a slack season. Soybean meal stocks last week in coastal regions rallied to 870,000 tonnes, an increase of 3.4% from a week earlier. Some oil plants urge the deliveries, which curbs meal price. And cottonseed meal trading is tepid. All these factors have brought cottonseed meal market bearish sentiment. But hog breeding keeps recovering, so the demand for soybean meal will be better in later period. Besides, the high cost still offers support to cottonseed meal market. Therefore, it is expected that short-term cottonseed meal market will fall not too much. Buyers can keep eyes on the trend of soybean meal. If soybean meal rebounds consecutively, cottonseed meal market will also be buoyed.

(USD $1=CNY ¥6.55)