Today (Dec 16), the market for oilseeds and oils in China is shown as follows:

Oilseeds:

Imported soybean: U.S. Gulf soybean is offered at 4,750 CNY/tonne at Shandong ports today. Soybean of lower prices previously have almost been digested, but the supply will gradually be increaisng under relaxed commodity inspections at ports. Moreover, imports of U.S. soybeans remain substantial, which will further add to supply in domestic market. Meanwhile, domestic purchasers tend to choose domestic soybeans and have little appetite for imported soybeans. These are all negative to imported soybean market. Overall, imported soybean market is predicted to steady in the short term.

Cottonseed: Cottonseed prices decline by 0.01 CNY/kg in some regions of China 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 in Shandong have suspended operation due to environmental warning. Hence, they have strong intention to force price down. But cottonseed output this year is lower than the previous year and cottonseed oil prices stay firm, which supports cottonseed market. It is expected that short-term cottonseed price will fluctuate narrowly in stability.

Oils: 

Summary: U.S. soybean futures rallied on Tuesday, bolstered by a tight U.S. soybean supply outlook as the crush went higher than the forecast and also by uncertain weather in South America. Oils futures fluctuate to climb on China’s Dalian Commodity Exchange today. In the spot markets, soybean oil partially goes up 50-100 CNY/tonne and palm oil up 120 CNY/tonne, both in lukewarm trade.

Malaysian palm oil exports rose 8.7-9.8% from a month earlier in December 1-15, which lends support to Dalian futures. In addition, the peak season for stocking up packaging oils has also started in China. Currently, China’s soybean oil stocks have fallen to 1.04 mln tonnes, and palm oil and rapeseed oil inventories are also low. Dalian January soybean oil contract stand above the key level of 8,000 today, bolstering the market confidence. Hence, the oil market is back to the uptrend in fluctuation. But soybean crush in China is expected to go above 2 mln tonnes weekly in the coming two weeks due to enormous soybean imports, so it is necessary to watch out for frequent fluctuations.

Soybean oil: GB Grade I soybean oil is mainly priced at 8,350-8,460 CNY/tonne in domestic coastal areas, a partial rise of 50-100 CNY/tonne. (Tianjin traders 8360; Rizhao traders 8350; Zhangjiagang traders 8460; and Guangzhou traders 8360-8380). 

Palm oil: RBD palm olein is mainly priced at 7,050-7,130 CNY/tonne in coastal areas, mostly up 120-130 CNY/tonne. (Tianjin traders 7130, up 120; Rizhao 7130, up 130; Zhangjiagang traders 7080, up 120; Guangzhou traders 7050-7060, up 120; and Xiamen not available).

Rapeseed oil: U.S. soybean futures closed sharply higher on Tuesday as U.S. November soybean crush hit the historical third highest level and soybean meal exports surged to a nearly eight-year high, coupled with an uncertain crop outlook in South America. Rapeseed oil futures are modestly higher on China’s Zhengzhou Commodity Exchange today. Spot rapeseed oil prices settle up 80-90 CNY at 9,920-10,070 CNY/tonne in coastal regions in tepid trading.

Tensions between Beijing and Ottawa keep rapeseed crush low in China, and rapeseed oil stocks are only 155,000 tonnes in the country. Meanwhile, soybean oil and palm oil inventories are also low and buyers will soon start stocking up oils for the Spring Festival, so there is no pressure on the supply side. But soybean crush is expected to go above 2 mln tonnes weekly in the coming two weeks, as soybean imports remain huge. Moreover, the consumption of rapeseed oil is smaller under its huge price spread with soybean oil and palm oil. These will limited rises in rapeseed oil prices. Overall, rapeseed oil price is predicted to maintain at the high level, and there will be mainly rigid demand in the market.

Cottonseed oil: Cottonseed oil prices keep steady with a partial decline of 100 CNY/tonne in China today. Downstream buyers are cautious due to weak demand in cottonseed oil market, which may weigh on its market. U.S. soybean futures post a wild rise boosted by higher-than-expected soybean crush. Oils futures fluctuate to go up on China’s Dalian Commodity Exchange today. In the spot market, soybean oil is up 50-100 CNY/tonne and palm oil jumps 120 CNY/tonne higher. Besides, the business inventory of soybean oil has fallen consecutively as domestic buyers have started stocking up packaging oils for New Year’s Day and the Chinese Lunar New Year. Also, rapeseed oil and palm oil stockpiles are at low levels. Hence, fundamentals are still bullish, and the bulk oils market will keep an uptrend in fluctuation. Moreover, cottonseed oil millers are facing sustained loss, so that they have certain sentiment in lifting prices. Overall, cottonseed oil market will remain flat relatively in the near term, but it is expected to go strengthening in later period.

Sunflower oil: Sunflower oil prices steady with a partial decline of 100 CNY/tonne in China today. Grade I imported sunflower oil is offered at 10,000-10,800 CNY/tonne; crude sunoil is offered at 9,650-9,750 CNY/tonne.

Downstream factory owners remain cautious in sunflower oil market and usually take hand-to-mouth buying as prices stay high, which is adding bearish impact to the market. But commercial soybean oil stocks keep falling, and palm oil and rapeseed oil stocks remain low in China, so fundamental bode well for the oils market. Meanwhile, sunflowerseed prices are high due to a reduction in production. Therefore, domestic millers have strong sentiment in propping up sunflower oil prices. Overall, sunflower oil market in China is predicted to fluctuate to slightly decline in the short run.

Corn oil: Corn oil prices are stable with a partial decline in China today. Grade I corn oil is offered at 10,000-10,300 CNY/tonne, down 100 CNY/tonne. (Shandong 10,200-10,300 CNY/tonne; Hebei 10,200; Liaoning 10,100; Sichuan 10,000); crude corn oil is offered at 8,300-8,700 CNY/tonne. (Hebei 8,500-8,600 CNY/tonne; Henan 8,500; Inner Mongolia 8,700).

Corn germ prices keep falling from the high level at present, and spot corn oil prices also remain high, which are bearish to the market. But millers have sentiment in propping prices as the cost remains high. Overall, short-term corn oil market is predicted to go weakening in fluctuation.

(USD $1=CNY ¥6.54)