Today (Dec 18), the market for meals in China is shown as follows:

Soybean meal: U.S. soybean futures soared past the $12 a bushel mark on Thursday, and meal futures open high and rise on China’s Dalian Commodity Exchange today. Spot soybean meal prices go up 20-50 CNY to 3,040-3,180 CNY/tonne in coastal regions, attracting better purchases at low levels. (Tianjin 3180, Shandong 3135-3180, Jiangsu 3085-3120, Dongguan 3040-3080, and Guangxi 3100-3120.)

Net crush margins for soybeans on Dalian have been at loss due to high import cost. Some mills in Rizhao have been limiting production subject to environmental protection, and some mills have also been limiting meal deliveries, so spot soybean meal prices follow futures to climb. However, soybean crush will keep rising in these two weeks due to adequate soybean stocks and in order to guarantee oil supply during the peak consumption season. 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 a slower recovery in hog stocks. Besides, traders are taking arbitrage in buying oil and selling meal. These are constraining rises in meal prices. In the short term, soybean meal prices will follow futures to fluctuate and rebound. Buyers are suggested to keep appropriate stocks, but not to chase after excessively higher prices.

Imported rapeseed meal: Driven by strong export and concerns over soybean crop in South America, U.S. soybean futures sharply rose overnight. Meal futures stage further gains on China’s exchanges today. Spot rapeseed meal is offered at 2,440-2,530 CNY/tonne in coastal China today, an increase of 20-30 CNY/tonne, in tepid trade.

China’s rapeseed imports have been affected by the stalemate between Beijing and Ottawa, so its rapeseed crush also remains small, which bolsters rapeseed meal price. But China’s soybean supplies are adequate due to enormous soybean cargoes arrivals at ports. To guarantee oils supply, domestic crushers will pick up operation rates over the next two weeks. Moreover, aquaculture has basically ceased and there is a sharp decline in poultry feed consumption in December due to sustained losses in breeding margins for poultry. Likewise, the demand for hog feed is also faltering as hog production recovery slows down. In consequence, soybean meal has been in slow delivery, leading to a rise in its inventory. This may limit uptrend of rapeseed meal price. Therefore, short-term rapeseed meal market is projected to rebound modestly but still fluctuate frequently.

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 6,000 tonnes, Tianjin 680 tonnes, Shanghai 25,100 tonnes, Huangpu 60,100 tonnes, Fuzhou 10,120 tonnes, Fangchenggang 1,100 tonnes and 1,500 tonnes at other ports.

FOB quotes from foreign markets today: Dec/Jan shipments are quoted at 1,310 USD/tonne for Peruvian Standard with 65% protein content and at 1,530 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.

Fish catches in north-central Peru: As of Dec 15 (local time), fish catches in the second season of 2020 total 1,368,480 tonnes, taking up 49.23% of the total quota of 2.78 mln tonnes and with the fishing average at around 40,000 tonnes per day and 1,411,520 tonnes remaining available. (Imarpe revised its fish catches data for Nov 16th and 22nd.)

Cottonseed meal: Cottonseed meal prices in part rise by 30-40 CNY/tonne in China today. U.S. soybean futures sharply rose overnight and hit 1,200 level. Meal futures post further gains after high opens on China’s Dalian Commodity Exchange today. Spot soybean meal up by 20-50 CNY/tonne. Crush margins for soybean futures have been negative as the cost of importing soybean remains high. And some oil plants have limited deliveries due to environmental protection warning, underpinning soybean meal price. Likewise, cottonseed cost also maintains a high level at present, which is supporting cottonseed meal prices. However, aquaculture has basically ceased and there are sustained losses in breeding margins for poultry. And the recovery of hog production capacity also slows down. These have affected market sentiment, which curbs meals prices rises. Add to that, cottonseed meal market is also in thin trade, which is also bearish to the market itself. Overall, it is expected that short-term cottonseed meal market may move toward an uptrend in stability.

(USD $1=CNY ¥6.53)