According to Cofeed, in the week as of Jan 15, details of soybean oil inventories and outstanding contracts in main domestic regions are as follows:

Operation rates for soybean crush pick up as expected this week (Jan 9-15). Crush margins are profitable in the wake of rises in both futures and spot prices, and due to robust soybean meal trade after sharp price rises, its inventory is getting tight in northern China while swollen inventory has eased among southern mills who have shipped their cargoes to northern markets. Soybean crush at domestic mills totals 1,981,980 tonnes (meal 1,565,764 tonnes and oil 376,576 tonnes), up 297,400 tonnes or 17.65% from 1,684,580 tonnes last week. Meanwhile, operation rates (capacity utilization) are 55.89%, up 7.78% from 48.11% in the previous week. As operation rates will continue rising in the coming two weeks, soybean crush is predicted to be about 2 mln tonnes next week (week 3) and 2.05 mln tonnes in week 4.

Soybean oil stocks further decline this week albeit a rise in soybean crush. Spot soybean oil is still tight in some regions, and some oil mills have a huge amount of outstanding contracts. In the week ending Jan 15, China’s soybean oil commercial inventories total 848,000 tonnes, down 36,350 tonnes by 4.11% from 884,350 tonnes last week, down 182,000 tonnes by 17.67% from 1,030,000 tonnes month on month, and down 29,500 tonnes by 3.36% from 877,500 tonnes year on year. And the five-year (2016-2020) average at the same period is 1,146,000 tonnes.

Fig.: China’s Soybean Oil Stocks in Recent Years