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

Soybean meal: U.S. soybean futures drastically fell last Friday on beneficial rains in South America, a stronger U.S. dollar and also the long liquidation. Meal futures open low and decline on China’s Dalian Commodity Exchange today. Spot soybean meal prices follow to drop 100-190 CNY at 3,480-3,900 CNY/tonne in tepid trade. (Tianjin 3900, Shandong 3630-3680, Jiangsu 3650-3790, Dongguan 3480-3520, and Guangxi 3570-3650.)

Chinese soybean processors are active due to decent crush margins for earlier imported cargoes and as downstream buyers are taking delivery at a brisk pace, and soybean crush rose to 2.1 mln tonnes in the week as of Jan 22. And downstream buyers are getting cautious as meal prices are adjusting at high levels. The restriction on production has been lifted in Rizhao, Shandong, and investors also want to recoup funds toward the end of the lunar year. The aforementioned factors combine to crack down meal prices, and spot prices decline more than futures, with basis narrowing down. But soybean meal stocks have reduced notably as buyers are taking delivery briskly toward the Lunar New Year, although soybean meal market has been in dismal trade for days. Some mills and distributors have no spot soybean meal available now, and millers have also signed many February contracts, so that they have sentiment to support prices and some have stalled sales and mainly carrying out contracts. In the short term, soybean meal prices will follow futures to retreat and adjust, and buyers can wait for low and stable prices to make appropriate replenishment.

Rapeseed meal: U.S. soybean futures take a nose dive last Friday. Meal futures on China’s exchanges also extend losses after low opens today. Spot rapeseed meal is offered at 2,640-2,730 CNY/tonne in coastal China today, a decrease of 30-40 CNY/tonne, in tepid trade. Soybean crush has risen by 6.3% to 2.1 mln tonnes due to sufficient supply of soybeans. Besides, aquaculture has basically ceased, and poultry stocks are lower result from early substantial losses in breeding margins. In this case, feed consumption slows down, slackening demand for meals. Rapeseed meal inventories have increased by 2.4% to 42,000 tonnes, and thereby cracking down rapeseed meal prices. With a lack of supportive factors, short-term rapeseed meal market is expected to track futures to fluctuate to fall.

Imported fishmeal: Imported fishmeal prices continue a slight rise today and can be traded through negotiation. Peruvian Standard SD with 65% protein content is 10,100-10,600 CNY/tonne, up 100-400 CNY from last Friday; Peruvian higher-quality SD with 65% protein content is 10,500-11,100 CNY/tonne, up 100-400 CNY; Peruvian higher-quality SD with 67% protein content is 11,100-11,500 CNY/tonne, up 100-400 CNY; and Peruvian Super Prime SD with 68% protein content is 11,600-12,000 CNY/tonne, up 100-400 CNY. Fishmeal stocks will continue reducing at domestic ports in the near term, offers from foreign markets keep firm, so traders have sentiment to support and hike prices. But the demand for fishmeal is subdued as aquaculture turns slack in winter, which is capping the upward space in domestic fishmeal market. In the short run, domestic fishmeal market is expected to steady with slight adjustments.

Stocks at ports: Dalian 2,700 tonnes, Tianjin 350 tonnes, Shanghai 6,000 tonnes, Huangpu 38,500 tonnes, Fuzhou 11,800 tonnes, Fangchenggang 1,000 tonnes and 2,800 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.

Cottonseed meal: Cottonseed meal prices stay stable with a partial decrease of 50-150 CNY/tonne in China today. Soybean futures slumped on CBOT last Friday due to strengthening US dollar, long liquidation as well as favorable rainfall in South America. Dalian meal futures extend losses after low opens today. Spot soybean meal also sharply declines by 100-190 CNY/tonne. Soybean crushing mills try to keep operating result from satisfactory crush margins for early arrived soybeans and fair delivery pace by downstream buyers. Besides, meals prices adjust at the high level recently, so downstream enterprises become cautious in stockpiling, there by weighing on soybean meal price. Moreover, aquaculture has basically ceased, and hog capacity recovery has slowed, seeing a subdued trade of cottonseed meal. This causes cottonseed meal price to decline. Additionally, cottonseed cost remains high, which supports cottonseed meal price as well. Nevertheless, short-term cottonseed meal market is projected to pare gains following soybean meal.

(USD $1=CNY ¥6.48)