Today (Dec 24), the market for oilseeds and oils in China is shown as follows:

Oilseeds:

Imported soybean: U.S. Gulf soybean is offered at 4,950 CNY/tonne at Shandong ports today. Some traders are unwilling to sell under tight supply at port now, and the cost import remains high due to a strong trend in U.S. soybean prices, which together bolster imported soybean prices at port to keep strengthening. However, commodity inspections are relax at ports now, and imports of U.S. soybeans are huge, so it is very likely that imported soybean supply will get increasing in China. In the short term, imported soybean market may keep strengthening on bullish factors.

Cottonseed: Cottonseed prices increase by 0.01-0.04 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 protection. 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 keep steady and trend up.

Oils: 

Summary: U.S. soybean futures rallied on Wednesday on possibly lower soybean production in Brazil and as Argentina port workers said they would spend Christmas on strike despite new pay offer. And oils futures recover wide gains on China’s Dalian Commodity Exchange today. In the spot markets, soybean oil prices surge 100-220 CNY/tonne and palm oil by 210-260 CNY/tonne. Buyers remain cautious in chasing after high prices as futures have been extremely volatile, so spot markets are in lukewarm trade. 

The market is expecting buyers could trigger a rush of buying spree as Malaysia starts to impose 8% export tariff on crude palm oil in January, and Malaysian palm oil exports was a month-on-month rise of over 18% during December 1 to 20. Besides, Indonesian palm oil exports and its domestic palm oil consumption in biodiesel in 2021 go above the forecast. Hence, BMD palm oil futures hit a fresh high in over nine years on Wednesday. This boosts the market confidence greatly. Meanwhile, oil mills in Rizhao are still in downtime under requirements by the environmental protection, and domestic soybean oil stocks are on a decline. Short-term oils market is predicted to maintain a strong trend owing to bullish factors. But funds are of a precarious character toward the end of the year, and the oils markets are in subdued trade after prices climb to high levels, so it is necessary to remain cautious.

Soybean oil: GB Grade I soybean oil is mainly priced at 8,600-8,860 CNY/tonne in domestic coastal areas, a rise of 100-220 CNY/tonne. (Tianjin traders 8680-8730; Rizhao traders 8600; Zhangjiagang traders 8770; and Guangzhou traders 8860). 

Palm oil: RBD palm olein is mainly priced at 7,280-7,390 CNY/tonne in coastal areas, mostly up 210-260 CNY/tonne. (Tianjin traders 7370-7390, up 260; Rizhao not available; Zhangjiagang traders 7280, up 210; Guangzhou traders 7300-7310, up 260; and Xiamen not available).

Rapeseed oil: U.S. soybean futures rallied on Wednesday on possibly lower soybean production in Brazil and as Argentina port workers said they would spend Christmas on strike despite new pay offer. The market is expecting buyers could trigger a rush of buying spree as Malaysia starts to impose 8% export tariff on crude palm oil in January, and Malaysian palm oil exports was a month-on-month rise of over 18% during December 1 to 20. Besides, Indonesian palm oil exports and its domestic palm oil consumption in biodiesel in 2021 go above the forecast. Hence, BMD palm oil futures hit a fresh high in over nine years on Wednesday. And Dalian palm olein futures also lead the oils market in China today. Spot rapeseed oil prices settle up 220-230 CNY at 10,050-10,200 CNY/tonne in coastal regions in tepid trading.

Rapeseed crush in China remains low as the country is less likely to see a detente in tensions with Canada shortly. China’s rapeseed oil supply is tight with only 160,000 tonnes now and soybean oil stocks also keep falling. Fundamentals are still supportive in the oils market, which is propping up rapeseed oil prices. However, soybean arrivals at domestic ports are huge and its supply is thus adequate. And the consumption of rapeseed oil is smaller under its huge price spread with soybean oil and palm oil. In the short term, rapeseed oil market is predicted to stay at the high level, and the trade is mainly from rigid demand.

Cottonseed oil: Cottonseed oil prices in part increase by 50-200 CNY/tonne in China today. U.S. soybean futures continued the surge overnight as Brazil’s soybean production would be revised down and Argentine oilseed workers and grains inspectors said on Wednesday they will spend Christmas on strike despite new pay offer by employers. Oils futures post wild gains on China’s Dalian Commodity Exchange today. In the spot market, soybean oil jumps 100-220 CNY/tonne and palm oil soars 210-260 CNY/tonne. Soybean arrival has been enormous at ports. And palm oil also hit a more-than-nine-year peak on Bursa Malaysia Derivatives last night. These have significantly shored up market confidence. Besides, soybean oil stocks keep falling with soyoil factories in Rizhao idled by environmental protection. Also, rapeseed oil stockpiles are at low levels. Hence, the overall oils market will maintain an uptrend dominated by supportive factors above. Moreover, cottonseed oil millers are facing sustained loss, so that they have certain sentiment in lifting prices. Therefore, it is predicted that short-term cottonseed oil market will go strengthening following bulk oils market.

Sunflower oil: Sunflower oil prices maintain stable in China today. Grade I imported sunflower oil is offered at 10,150-10,800 CNY/tonne; crude sunoil is offered at 9,650-9,750 CNY/tonne.

U.S. soybean futures rallied on Wednesday on possibly lower soybean production in Brazil and as Argentina port workers said they would spend Christmas on strike despite new pay offer. And oils futures recover wide gains on China’s Dalian Commodity Exchange today. In the spot markets, soybean oil prices surge 100-220 CNY/tonne and palm oil by 210-260 CNY/tonne. Meanwhile, sunflower oil is in tight supply as a reduction in sunflowerseed production causes a supply woe. Sunflower oil millers have strong sentiment in supporting oil prices, which is positive to the market. However, soybean arrivals at domestic ports remain enormous, and the pandemic becomes more severe in European countries. And as sunflower oil prices have been at a high level recently, downstream manufacturers are cautious and the market is in thin trade, which is adding bearish influence to the market. Overall, sunflower oil market in China is predicted to fluctuate and marginally climb in the short run.

Corn oil: Corn oil prices are stable in China today. Grade I corn oil is offered at 10,000-10,300 CNY/tonne. (Shandong 10,200-10,300 CNY/tonne; Hebei 10,200; Liaoning 10,000; Sichuan not available); crude corn oil is offered at 8,450-8,700 CNY/tonne. (Hebei 8,450-8,600 CNY/tonne; Henan 8,500; Inner Mongolia 8,700).

Domestic corn oil millers have sentiment to raise prices due to sustained loss at present and withe the the start of the peak season for stocking up packaging oils. But corn oil price itself is high, which may be adding bearish sentiment to the market. Overall, corn oil market is predicted to keep strengthening.

(USD $1=CNY ¥6.54)