Today (Jan 20), the market for meals in China is shown as follows:

Soybean meal: U.S. soybean futures eased on Tuesday on profit-taking after soybean crops in South America welcomed much-needed rains during the weekend. Meal futures decline after lower opens on China’s Dalian Commodity Exchange today. Spot soybean meal prices settle down 80-150 CNY at 3,600-4,020 CNY/tonne in coastal regions in weaker trade. (Tianjin 4020, Shandong 3900-3970, Jiangsu 3760-3810, Dongguan 3600-3640, and Guangxi 3650-3750.)

As soybean imports remain huge and to satisfy the demand for oil and meal, Chinese crushers sharply picked up weekly soybean crush by 18% to 1.98 mln tonnes last week and will probably continue to raise it to 2 mln tonnes in the coming two weeks. And downstream buyers get more cautious in soybean meal market about current high prices, so that the trade is reducing in spot market and clinched mainly on forward basis. Add to that, feed manufacturers have started using wheat, paddy and barley to replace corn whose prices keep rising, and high protein in wheat will also lead to a reduction in soybean meal use. These are all weighing down soybean meal prices.

But some oil millers have sold out spot soybean meal for January, and soybean meal inventory has sharply shrunk to a relatively low level. In addition, crush margins for imported U.S. soybeans on Dalian is at loss, and market participants may again speculate on weather in South America at any time. It can be said for sure that soybean meal has been on a downtrend, and current declines are more like retreat and corrections after sharp rises. In the short term, soybean meal prices may continue following futures to ease and adjust, and buyers can wait for low and stable prices to make appropriate replenishment.

Rapeseed meal: U.S. soybean futures slumped on Tuesday on profit taking incurred by favorable rainfall last weekend in South America. Meal futures fall back with low opens and expand losses today on China’s exchanges. Spot rapeseed meal is offered at 2,710-2,830 CNY/tonne in coastal China today, a drop of 120 CNY/tonne, in tepid trade. With recent adequate supply, soybean crush sharply rose 18% to 1.98 mln tonnes last week and would likely get back to 2 mln tonnes this week. Besides, aquaculture has basically ceased, and hog capacity recovery slows due to a large amount of hog slaughter. In this case, feed consumption slows down, slackening demand for meals. Rapeseed meal trading becomes tepid, weighing on rapeseed meal price. But the cost of importing soybean remains high, and rapeseed crush maintains the low level amid lower imports, which may limit downside of rapeseed meal market. It is predicted that short-term rapeseed meal price may move with fluctuations.

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. Fishmeal stocks have been reducing in Peru, so that local manufacturers are propping up prices. And fishmeal stocks also continue decreasing at domestic ports. Hence domestic traders have sentiment to support and lift 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 3,600 tonnes, Tianjin 440 tonnes, Shanghai 7,500 tonnes, Huangpu 41,500 tonnes, Fuzhou 12,700 tonnes, Fangchenggang 1,100 tonnes and 3,500 tonnes at other ports.

FOB quotes from foreign markets today: Jan/Feb shipments are quoted steadily at 1,380 USD/tonne for Peruvian Standard with 65% protein content and at 1,600 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 Jan 17 (local time), fish catches in the second season of 2020 total 2,358,520 tonnes, taking up 84.84% of the total quota of 2.78 mln tonnes and with the fishing average at around 35,000 tonnes per day and 421,480 tonnes remaining available. (Imarpe revised its fish catches data for Nov 16th and 22nd.)

Cottonseed meal: Cottonseed meal prices stay stable with a partial decrease of 50-100 CNY/tonne in China today. Much needed rainfall across soybean area in Argentina and Brazil during the weekend has improved crop condition, triggering profit taking. Affected by this, U.S. soybean futures plummeted overnight. Dalian meal futures also fall back after low opens and expand losses today. Spot soybean meal declines by 80-150 CNY/tonne in coastal regions. Aquaculture has basically ceased, and hog capacity recovery has slowed, seeing a subdued trade of cottonseed meal. This causes cottonseed meal price to decline. But the cost of importing soybean stays high, and cottonseed cost also remains high, which supports cottonseed meal price as well. Therefore, cottonseed meal market is projected to fluctuate to fall from the high level in the near term.

(USD $1=CNY ¥6.48)