Today (Dec 25), the market for meals in China is shown as follows:

Soybean meal: U.S. soybean futures further rose on Thursday, as Argentine port workers would spend Christmas on strike, but strong oils futures has triggered a active arbitrage, so meal futures open low and decline on China’s Dalian Commodity Exchange today. Spot soybean meal prices steadily drop by 10-20 CNY to 3140-3270 CNY/tonne in coastal regions in tepid trade. (Tianjin 3270, Shandong 3230-3270, Jiangsu 3170-3240, Dongguan 3140-3160, and Guangxi 3200-3230.)

Operation rates in domestic oil mills still stay at high levels, but soybean meal market has been in thin trade in the wake of sharp rises in price, for slack aquaculture in winter and low poultry stocks under previous breeding loss have slowed down terminal consumption. Besides, oil mills in Guangdong and Guangxi are bearing meal inventory pressure and have been quickening up deliveries. These are curbing meal prices. However, net crushing margins for soybeans on Dalian are at loss due to high import cost. And oil mills in Rizhao have called off the delivery during the production suspension under the environmental protection, and millers in other regions of Shandong Province are also limiting the delivery, which help ramp up shipments in Jiangsu Province. Oil mills still have strong sentiment to raise prices, thus constraining the downside space in meal price. Short-term soybean meal prices stagnate and decline on lackluster fundamentals, but with support of cost under strong U.S. soybean futures, soybean meal prices will have limited declines and fluctuate to keep strengthening overall.

Imported rapeseed meal: U.S. soybean futures further rose on Thursday as Argentine workers strike would last until Christmas holiday. But oils futures stage strong performance due to profit taking, so meal futures fall back after opening low on China’s exchanges. Spot rapeseed meal is offered at 2,550-2,620 CNY/tonne in coastal China today, a decrease of 20-50 CNY/tonne, in tepid trade.

China’s soybean supplies are adequate due to enormous soybean cargoes arrivals at ports. To guarantee oils supply, soybean crush maintains the high level. Moreover, aquaculture has basically ceased, and the demand for poultry feed has sharply declined as there are sustained losses in breeding margins for poultry. Moreover, downstream buyers become cautious due to slow consumption and price hike. In this case, rapeseed meal stocks will probably rebound this week and its price is dragged down. However, China’s rapeseed imports have been affected by the stalemate between Beijing and Ottawa, so its rapeseed crush also remains small. This has boosted rapeseed meal price. But U.S. soybean still keeps a strong trend, pushing up the cost of importing soybean. Overall, short-term rapeseed meal market will continue fluctuating to stay strong.

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. Small port stocks and the influence of a possible delay in new fishmeal shipment and arrivals are supportive of fishmeal prices at domestic ports. But the demand for fishmeal is subdued as aquaculture turns slack in winter and the recovery in hog herd is limited now, so feed manufacturers tend to take hand-to-mouth buying at present, which is capping the upward space in domestic fishmeal market. Overall, domestic fishmeal prices are expected to be little changed in the near term.

Stocks at ports: Dalian 6,000 tonnes, Tianjin 650 tonnes, Shanghai 21,870 tonnes, Huangpu 58,800 tonnes, Fuzhou 10,800 tonnes, Fangchenggang 1,500 tonnes and 1,600 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 22 (local time), fish catches in the second season of 2020 total 1,629,370 tonnes, taking up 58.61% of the total quota of 2.78 mln tonnes and with the fishing average at around 40,000 tonnes per day and 1,150,630 tonnes remaining available. (Imarpe revised its fish catches data for Nov 16th and 25th.)

Cottonseed meal: Cottonseed meal prices keep steady with an increase of 60-80 CNY/tonne in several regions of China today. U.S. soybean futures continue rising overnight as work stoppage of Argentine workers would extend to Christmas holiday. Crush margins for soybean futures have been negative as the cost of importing soybean remains high. And soybean crushing mills in Rizhao have been idled due to environmental protection, so they halt the deliveries. Same goes for oil plants in other regions of Shandong. Consequently, they have intention to raise the price of soybean meal. Likewise, cottonseed cost also maintains a high level at present, which is supporting cottonseed meal prices. However, aquaculture has basically ceased, and the demand for poultry feed is impacted by sustained losses in breeding margins for poultry. Add to that, cottonseed meal market is also in thin trade, which is also bearish to the market itself. Therefore, cottonseed meal market is likely to fluctuate to stay strong in a short term.

(USD $1=CNY ¥6.53)