Today (Jan 8), the market for meals in China is shown as follows:

Soybean meal: U.S. soybean futures closed lower on Thursday on profit-taking. Meal futures moderately decline in early trade but move higher to see slight gains toward noon session. Spot soybean meal prices settle at 3,420-3,620 CNY/tonne in coastal regions, mostly up10-30 CNY/tonne, attracting some low-level and forward-month buying but with weaker trade than yesterday. (Tianjin 3620, Shandong 3530-3580, Jiangsu 3510-3560, Dongguan 3420-3450, and Guangxi 3460-3490.)

Net crush margins for U.S. soybeans are still at loss on Dalian due to high import cost. And domestic soybean meal has been in robust trade this week, as downstream buyers get down to stock up for the Spring Festival in advance for fear that logistics could be interrupted by the pandemic. Soybean meal market traded 1.87 mln tonnes this week as of Thursday, improving the market confidence. Oil millers have strong sentiment to hike prices, bolstering meal prices to keep rising. China’s soybean meal prices will probably keep an uptrend in fluctuation on the push of cost side as U.S. soybean futures may continue an upward momentum, but it is necessary to avoid risks of fluctuations in the wake of sharp gains since domestic oil mills will pick up soybean crush again in coming two weeks under huge imports and adequate stocks.

Imported rapeseed meal: U.S. soybean futures closed down overnight on uncertain availability in South America. Rapeseed meal futures on China’s Zhengzhou Commodity Exchange ease back in early trade but later move higher in afternoon session. Spot rapeseed meal is offered at 2,700-2,800 CNY/tonne in coastal China today, an advance of 10-20 CNY/tonne, in tepid trade. Net crush margins for soybean futures have been negative as the cost of importing soybean remains high. And rapeseed crush remains low due to limited imports of rapeseed, which may buoy rapeseed meal market. Besides, soybean crushing mills will pick up the operation rate over the next two weeks on adequate supplies. Nevertheless, aquaculture has basically ceased, and poultry stocks are low attributed to substantial losses in breeding margins previously. Also, hog capacity recovery becomes slower attributed to intensive slaughter ahead of the Lunar New Year. In this case, feed consumption slows down, and the deliveries are slackened, leading to an increase in inventories of rapeseed meal and soybean meal. This has limited rapeseed meal gains and the short-term market is predicted to fluctuate at high levels.

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 11,000-11,100 CNY/tonne; and Peruvian Super Prime SD with 68% protein content is 11,500-11,600 CNY/tonne. Domestic fishmeal stocks keep falling at present so that traders have some sentiment to prop up or raise prices. But the demand for fishmeal is subdued as aquaculture turns slack in winter and the recovery in hog herd is limited now, which is capping the upward space in domestic fishmeal market. Overall, domestic fishmeal prices are expected to steady with slight adjustments in the near term.

Stocks at ports: Dalian 5,050 tonnes, Tianjin 550 tonnes, Shanghai 14,100 tonnes, Huangpu 51,100 tonnes, Fuzhou 11,900 tonnes, Fangchenggang 1,000 tonnes and 2,600 tonnes at other ports.

FOB quotes from foreign markets today: Jan/Feb shipments are quoted at 1,340 USD/tonne for Peruvian Standard with 65% protein content and at 1,560 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 increase of 50-100 CNY/tonne in China today. U.S. soybean futures closed lower last night on profit taking. Meal futures on China’s Dalian Commodity Exchange modestly fall back in morning session but later shift to higher range with a marginal growth in afternoon trade. And spot soybean meal mostly increases by 10-30 CNY/tonne in coastal regions. Net crush margins for soybean futures have been negative as the cost of importing soybean stays high. And traders have begun stocking up ahead of the Lunar New Year, so soyoil mills have intention to lift prices. These have together given a boost to soybean meal price. Besides, cottonseed crush remains low due to its high cost, which buoys cottonseed meal price as well. In addition, aquaculture has basically ceased, and hog capacity recovery also slows. Moreover, cottonseed meal market is also in thin trade. Driven by high cost, the overall cottonseed meal market will still keep strengthening.

(USD $1=CNY ¥6.47)