According to Cofeed, in the week as of Dec 25, details of soybean oil inventories and outstanding contracts in main domestic regions are as follows:

As some oil mills stay in downtime subject to the environmental protection in Shandong and some suspend or limit production under swelling meal inventory in Guangdong and Guangxi, operation rates for soybeans decline as expected this week (Dec 19-25). The decline even goes beyond the forecast as the downtime is long due to severe air pollution in Rizhao, Shandong Province. Soybean crush at domestic mills totals 1,882,080 tonnes (meal 1,486,843 tonnes and oil 357,595 tonnes), down 125,100 tonnes or 6.23% from 2,007,180 tonnes last week. Meanwhile, operation rates (capacity utilization) are 53.75%, down 3.58% from 57.33% in the previous week. Soybean crush is predicted to be 1.82 mln tonnes and near 2.0 mln tonnes in the coming two weeks, respectively.

Soybean oil stocks further reduce this week, as soybean crush fell as expected. In the week ending Dec 25, China’s soybean oil commercial inventories total 1,002,850 tonnes, down 17,850 tonnes by 1.75% from 1,020,700 tonnes last week, down 157,150 tonnes by 13.55% from 1,160,000 tonnes a month earlier, and up 86,120 tonnes by 9.39% from 916,730 tonnes of the corresponding period last year. And the five-year (2015-2019) average at the same period is 1,214,500 tonnes.

Fig.: China’s Soybean Oil Stocks in Recent Years