Today (Dec 14), the market for meals in China is shown as follows:

Soybean meal: U.S. soybean futures rose last Friday, and meal futures edge down on China’s Dalian Commodity Exchange today. Spot soybean meal prices steadily fluctuate by 10-30 CNY to 2,980-3,100 CNY/tonne in coastal regions in thin trade. (Tianjin 3100, Shandong 3035-3070, Jiangsu 2990-3050, Dongguan 2980-3000, and Guangxi 3040-3050.)

The supply of soybean is adequate in China owing to huge cargo arrivals at ports, and domestic buyers will commence stocking up packaging oils ahead of the Chinese Lunar New Year, so domestic crushers have elevated operation rates again. Meanwhile, aquaculture has come to a standstill in winter, November poultry feed production also saw a sharp decline due to sustained loss in breeding, and producers slowed down the recovery in hog sector; hence, China’s feed production posted a month-on-month decline in November. Soybean meal is thus in slow shipment and saw a rise in inventory last week, so that millers have quickened up deliveries, which is curbing meal prices. However, net crush margins for soybeans on Dalian have been at loss due to high import cost, so that mills still have strong sentiment propping up prices. In a hybrid of the bull and the bear, short-term soybean meal may follow futures to fluctuate at the narrow range, and buyers can wait or stake hand-to-mouth buying.

Imported rapeseed meal: U.S soybean futures closed higher last Friday. Rapeseed meal futures fluctuate slightly on Zhengzhou Commodity Exchange today. Spot rapeseed meal is offered at 2,370-2,430 CNY/tonne in coastal China today, a fluctuation of 10-20 CNY/tonne, in tepid trade. China’s soybean supplies are adequate due to enormous soybean cargoes arrivals at ports. In this case, soybean crush last week rose 9% to 1.95 mln tonnes. Moreover, aquaculture has turned slack seasonally and there is a sharp decline in poultry feed consumption due to sustain losses in breeding margins for poultry and a decline in layer stocks. This may depress rapeseed meal prices. However, China’s rapeseed imports have been affected by the stalemate between Beijing and Ottawa, so its rapeseed crush also remains small, which limits price declines of rapeseed meal. Rapeseed meal inventories in the previous week decline by 50% to 3,000 tonnes. Overall, rapeseed meal market is predicted to keep range-bound in a short term.

Imported fishmeal: Imported fishmeal prices are stable today and can be traded through negotiation. Peruvian Standard SD with 65% protein content is 10,000-10,200 CNY/tonne; Peruvian higher-quality SD with 65% protein content is 10,400-10,700 CNY/tonne; Peruvian higher-quality SD with 67% protein content is 10,900-11,100 CNY/tonne; and Peruvian Super Prime SD with 68% protein content is 11,400-11,500 CNY/tonne. Domestic port traders bear no pressure in holding stocks under the support of firm prices in foreign market, reducing fishmeal cargoes at domestic ports and a sustained decline in domestic port fishmeal stocks. However, domestic demand for fishmeal is decreasing in aquaculture as the weather gets cool, so that feed companies have little enthusiasm making purchases, which is constraining the market. Overall, domestic fishmeal prices are expected to steady with slight adjustments in the near term.

Stocks at ports: Dalian 6,000 tonnes, Tianjin 550 tonnes, Shanghai 26,800 tonnes, Huangpu 61,960 tonnes, Fuzhou 10,600 tonnes, Fangchenggang 1,050 tonnes and 2,000 tonnes at other ports.

FOB quotes from foreign markets today: Dec/Jan shipments are quoted steadily at 1,360 USD/tonne for Peruvian Standard with 65% protein content and at 1,580 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.

Cottonseed meal: Cottonseed meal prices stay stable with a partial decline of 50-100 CNY/tonne in China today. Soybeans are in ample supply as soybean arrivals at ports have been enormous. Domestic buyers have started stocking up packaging oils for the Chinese Lunar New Year, and in order to guarantee oils supplies, domestic crushers will pick up operation rates in the next two weeks. However, aquaculture has turned slack seasonally, and there is a sharp decline in poultry feed consumption due to sustain losses in breeding margins for poultry and a decline in layer stocks. Plus, feed production will keep a downward trend month-on month from November, affecting the delivery of soybean meal. Add to that, cottonseed meal market is also in thin trade, which is also bearish to the market itself. Besides, cottonseed cost also remains at a high level at present, which is supporting cottonseed meal prices. Overall, it is expected that short-term cottonseed meal market may fluctuate narrowly in stability.

(USD $1=CNY ¥6.54)