Today (Nov 24), 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 dip by 0.01 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 and cottonseed oil stays firm, which supports cottonseed market. It is expected that cottonseed price will fluctuate narrowly in a short term and keep strengthening on the whole.

Oils: 

Summary: U.S. soybean futures further climbed on Monday on sustaining dry weather in South America and on brisk U.S. soybean exports, and as British drugmaker AstraZeneca said that its vaccine could be around 90% effective. Oils futures continue falling on China’s Dalian Commodity Exchange today, but the losses are smaller and palm olein stays above the previous close. In the spot markets, soybean oil goes down 20-100 CNY/tonne and palm oil up 50-70 CNY/tonne, both in tepid trade.

Dalian oils futures fell broadly yesterday, but the losses are notably smaller today. Besides, Concerns remain on a reduction in palm oil production, as Malaysian Nov 1-20 output fell 10-14% month on month, which could make the country see lower stockpiles at the end of November. And soybean crush margins for nearby months on Dalian have been at a loss, for the import cost has been lifted by high U.S. soybean prices. China’s soybean oil supply is not a pressure now, and its palm oil and rapeseed oil inventories are also low. Hence, fundamentals are still bullish in the oils market. Overall, the oils market is expected to rise again after this round of decline, and buyers can wait for low and stable prices to see if it is necessary to make some replenishment.

Soybean oil: GB Grade I soybean oil is mainly priced at 8,040-8,080 CNY/tonne in domestic coastal areas, a decline of 20-110 CNY/tonne. (Tianjin traders 8040; Rizhao traders 8080; Zhangjiagang traders 8040; and Guangzhou traders 8050-8060). 

Palm oil: RBD palm olein is mainly priced at 6,750-6,860 CNY/tonne in coastal areas, mostly up 50-70 CNY/tonne. (Tianjin traders 6860, up 70; Rizhao not available; Zhangjiagang traders 6810, up 50; Guangzhou traders 6750-6770, up 50; and Xiamen not available).

Rapeseed oil: U.S. soybean futures further climbed on Monday on sustaining dry weather in South America and on brisk U.S. soybean exports. But rapeseed oil futures open low and decline on China’s Zhengzhou Commodity Exchange today. Spot rapeseed oil prices go down 20-30 CNY to 10,140-10,270 CNY/tonne in coastal regions in tepid trading.

Huge soybean arrivals and adequate soybean supplies keep the crush at a high level in China, and the consumption of rapeseed oil is also affected by its huge price spread with soybean oil and palm oil; hence, rapeseed oil market keeps falling. But China’s rapeseed oil stocks are only 199,000 tonnes now, a decline of 48% from a year earlier; soybean oil stockpiles have also fallen for a sixth straight week to 1.17 mln tonnes; and palm oil inventories are also low compared to this period in previous year. Meanwhile, there is a a rise in demand from feed this year. These will support rapeseed oil prices to stay at the high level.

Cottonseed oil: Cottonseed oil prices keep steady with a decrease of 50-100 CNY/tonne in some regions today. Britain’s drugmaker AstraZeneca said on Monday its vaccine for the novel coronavirus could be around 90% effective. U.S. soybean futures further rose on Monday on the news and strong export as well as prolonged dryness across crop area in South America. Soybean oil on China’s Dalian Commodity Exchange continues falling today but notably narrows declines, and spot soybean oil drops by 20-100 CNY/tonne. As a result, bulk oils market pares gains, which may also weigh on cottonseed oil market. Besides, the cost of importing soybean is climbing up and the supply of soybean oil is sufficient. Accordingly, oils market will remain bullish. In addition, cottonseed crushing mills keep facing losses as cottonseed is still pricey, so they intend to prop up prices. It is predicted that cottonseed oil market will not drop too much and keep a strengthening trend on the whole.

Sunflower oil: Sunflower oil prices are mostly stable with a partial rise of 50 CNY in China today. Grade I imported sunflower oil is offered at 10,000-10,650 CNY/tonne; crude sunoil is offered at 9,700-9,900 CNY/tonne.

Concerns remain on a reduction in palm oil production, as Malaysian Nov 1-20 output fell 10-14% month on month, which could make the country see lower stockpiles at the end of November. Meanwhile, soybean import cost is climbing as U.S. soybean prices stay high. And palm oil and rapeseed oil inventories are also low in China at present. Hence, fundamentals are still bullish in oils market. Moreover, global vegetable oils are in tight supplies, and sunflower oil prices are at high levels in foreign countries. In addition, a reduction in sunflowerseed production is also lifting prices. Therefore, millers have strong sentiment in propping up sunflower oil prices. Overall, sunflower oil market in China is expected to continue an strengthening trend.

Corn oil: Corn oil prices steady in China today. Grade I corn oil is offered at 10,000-10,500 CNY/tonne. (Shandong 10,200-10,500 CNY/tonne; Hebei 10,200; Liaoning 10,000; Sichuan 10,100); crude corn oil is offered at 8,500-8,600 CNY/tonne. (Hebei 8,350-8,600 CNY/tonne; Henan 8,500; Inner Mongolia 8,300).

Chinese millers still have sentiment in propping up prices as the cost remains high and there is a rise in corn germ prices, which is positive to the market. But spot corn oil stays at high prices. And its supplies are increasing due to a pickup in operation rates, whilst downstream buyers have little appetite under dismal demand. These are pressuring the market. Overall, corn oil market is predicted to keep firm in the short run.

(USD $1=CNY ¥6.58)