Today (Feb 24), the market for oilseeds and oils in China is shown as follows:

Oilseeds:

Imported soybean: Domestic market trade has not returned to normal right after the lunar new year holidays, so purchases and sales are both poor, which is negative to imported soybean market. But port soybean supply is relatively small. And U.S. soybean prices are strong due to strong demand and as rainfalls delay soybean harvest in Brazil, so soybean import cost remains high in China. These are supporting imported soybean market. In a hybrid of the bull and the bear, short-term imported soybean market may be little changed in the short term. Participants can keep an eye on imported soybean arrivals and demand in China.

Cottonseed: Cottonseed prices in China are mostly not offered and partly 0.03-0.05 CNY/kg higher today. Cottonseed crushing mills keep facing losses as cottonseed price remains too high. Besides, a few operative factories mainly consume their stocks now. In this case, cottonseed trading is light in market. However, cottonseed production this year is lower than the previous year. And ginning factories in Xinjiang are mostly shut down, seeing limited availability for cottonseed in market. This has offered a support to cottonseed market. With bulk oils increasing, it is expected that cottonseed price will be trending up based on the high level in the near term.

Oils: 

Summary: U.S. soybean futures surged on Tuesday, as a slow harvest in Brazil would likely bolster the export demand for U.S. soybeans. Oils futures continue a strong uptrend on China’s Dalian Commodity Exchange today. In the spot markets, soybean oil goes up 90-160 CNY/tonne and palm oil up 120-140 CNY/tonne. The trade is predicted to be decent on low-level basis.

Crude oil prices return to more than one-year high at present, which will help improve the demand for biodiesel, so BMD palm oil futures are bolstered by the demand outlook. China’s soybean oil supply is not a pressure, although stocks have risen to 870,000 tonnes. And domestic palm oil and rapeseed oil stocks are also low. China’s monthly soybean imports are forecast to be only 620 mln tonnes on average in February and March, following sluggish harvest and shipment in Brazil. This will likely affect soybean crush in China. Besides, U.S. dollar posts a weak outlook under Biden administration’s $1.9 trillion stimulus package, so funds are rushing to go long n the context of high macro-liquidity. The overall oils market is predicted to keep a strong trend. While being bullish, participants also need to keep a lookout at fluctuations in the uptrend.

Soybean oil: GB Grade I soybean oil is mainly priced at 9,460-9,780 CNY/tonne in domestic coastal areas, a rise of 90-160 CNY/tonne. (Tianjin traders 9460-9480; Rizhao traders 9400; Zhangjiagang traders 9560-9580; and Guangzhou traders 9730-9780). 

Palm oil: RBD palm olein is mainly priced at 8,080-8,130 CNY/tonne in coastal areas, up 120-140 CNY/tonne. (Tianjin traders 8080, up 140; Rizhao traders 8130, up 120; Zhangjiagang traders 8080, up 120; Guangzhou traders 8080, up 130; and Xiamen not available).

Rapeseed oil: U.S. soybean futures surged on Tuesday on concerns that a slow harvest in Brazil would highlight the already tight supply situation in the United States, and oils futures continue rising on China’s commodity exchanges today. Spot rapeseed oil prices settle up 160-180 CNY at 10,940-11,160 CNY/tonne in coastal regions in tepid trading. 

No pressure is noted in oils supplies in domestic markets. China’s monthly soybean imports are forecast to be only 620 mln tonnes on average in February and March, following sluggish harvest and shipment in Brazil. This will likely affect soybean crush in China. Besides, U.S. dollar posts a weak outlook under Biden administration’s $1.9 trillion stimulus package. Funds are rushing to go long n the context of high macro-liquidity, so global commodity prices will probably keep an overall uptrend. Bolstered by the above bullish factors, short-term rapeseed oil market is predicted to strengthen at the high level.

Cottonseed oil: Cottonseed oil prices mostly further increase by 100-200 CNY/onne in China today. U.S. soybean futures further rose on Tuesday. Oils futures post strong gains on Dalian Commodity Exchange today. In the cash market, soybean oil rises by 90-160 CNY/tonne and palm oil represents an increase of 120-140 CNY/tonne. For the moment, crude oil price stays at an over-one-year high, which helps in improving demand for biofuels. Thereby this boost demand outlook of palm oil. Moreover, soybean arrivals during the month of February and March could be only 6.2 mln tonne each month, which may affect the operation rates in crushing mills. Thus, short-term bulk oils market will maintain a strong uptrend. In addition to this, a majority of oil plants have yet to resume the operation, which is bullish for cottonseed oil. Following the strong bulk oils, short-term cottonseed oil market is predicted to maintain the strong uptrend.

Sunflower oil: Sunflower oil prices are stable with a partial rise of 70-200 CNY/tonne in China today. Grade I imported sunflower oil is offered at 11,500-12,000 CNY/tonne, and crude sunoil is offered at 11,500 CNY/tonne.

U.S. soybean futures further rose on Tuesday as a slow soybean harvest in Brazil will likely bolster the export demand of U.S. soybeans. Oils futures continue a strong uptrend on China’s Dalian Commodity Exchange today, and spot soybean oil goes up 90-160 CNY/tonne and palm oil up 120-140 CNY/tonne.  China’s stocks of palm oil and rapeseed oil are not huge at present. In addition, sunflower oil import cost has been lifted as the reduction in Ukrainian sunflowerseed production has pushed higher prices. These are bolstering sunflower oil market. In the near term, sunflower oil prices in China may continue to stay at high levels.

Corn oil: Corn oil prices are mostly stable with a partial rise of 300 in China today. Grade I corn oil price is 10,400-10,800 CNY/tonne (Shandong 10,500-10,800 CNY, up 300 CNY; and Liaoning 10,700; Liaoning 10,400); and crude corn oil is offered at 8,800-9,250 CNY/tonne (Henan 8,800 and Hebei 9,000-9,250).

Due to a rise in feedstock corn germ prices and high processing cost, sellers have strong sentiment to support prices. And processors are mainly fulfilling contracts as purchases have been brisk before the festival. Dalian oils futures also continue a strong uptrend today in the wake of gains in U.S. soybean futures on Tuesday, and spot soybean oil goes up 90-160 CNY/tonne and palm oil up 120-140 CNY. These are bullish to corn oil market. But corn oil prices are not competitive compared to rival oils, in addition to limited demand, which is weighing down the market. Overall, short-term corn oil market is predicted to maintain a strong trend in China.

(USD $1=CNY ¥6.46)