Today (Dec 15), the market for meals in China is shown as follows:

Soybean meal: U.S. soybean futures continued rising on Monday on good export inspection data by the USDA and on an uncertain crop outlook in South America where rainfalls were reported to be lower than forecast during the weekend. Meal futures edge lower on China’s Dalian Commodity Exchange today. Spot soybean meal prices steadily fluctuate by 10-20 CNY to 2,970-3,090 CNY/tonne in coastal regions in thin trade. (Tianjin 3090, Shandong 3040-3080, Jiangsu 2985-3020, Dongguan 2970-3000, and Guangxi 3030-3050.)

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. Currently, aquaculture has come to a standstill in winter, and the demand for poultry feed also sees a sharp decline due to loss in breeding, coupled with the decline in highly-expected hog feed; hence, soybean meal is in slow shipment and its inventory rose 5.7% weekly to 880,000 tonnes. Domestic millers are seeking to quicken up meal 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. Improving weather recently is bolstering the soybean outlook in South America, but meal demand is sluggish and inventories are swelling in China now. In the short term, soybean meal may follow futures to post a weakening trend, and buyers can stay on the sidelines.

Imported rapeseed meal: U.S soybean futures closed higher on Monday on good export data and uncertain soybean crop outlook in South America. But rapeseed meal futures fluctuate to decline on Zhengzhou Commodity Exchange today. Spot rapeseed meal is offered at 2,340-2,430 CNY/tonne in coastal China today, a decrease of 10-30 CNY/tonne, in tepid trade. China’s soybean supplies are adequate due to enormous soybean cargoes arrivals at ports. In this case, soybean crush will keep rising over the next two weeks and may get back to over 2 mln tonnes. Moreover, aquaculture has turned slack seasonally and there is a sharp decline in poultry feed consumption in December due to sustain losses in breeding margins for poultry. Likewise, the recovery of hog production capacity has slowed. Soybean meal inventories rise again, weighing on rapeseed meal price. 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. Overall, rapeseed meal market is predicted to keep range-bound in a short term. Buyers can take a wait-and-see attitude.

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 reducing fishmeal cargoes to 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 6,100 tonnes, Tianjin 600 tonnes, Shanghai 26,000 tonnes, Huangpu 61,600 tonnes, Fuzhou 10,300 tonnes, Fangchenggang 1,030 tonnes and 1,950 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 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. In this case, soybean meal has been in slow delivery and its inventory totals 880,000 tonnes in coastal regions with an increase of 5.7% from the previous week. Many crushers still urge buyers to take delivery, curbing meal price. 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 continue fluctuating narrowly in stability.

(USD $1=CNY ¥6.54)