Today (Feb 25), 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 partly 0.02-0.05 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 and meals 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 rose on Wednesday as storms forecast for production areas of Brazil would disrupt crop harvest activities, which would further tighten U.S. soybean supplies, as well as on a weak U.S. dollar. And oils futures continue advancing boldly on China’s Dalian Commodity Exchange today, with palm olein and soybean oil successively broke through 7,600 and 8,800 levels intraday. In the spot markets, soybean oil goes up 50-170 CNY/tonne and palm oil up 40-70 CNY. As buyers remain more cautious in chasing after higher prices, the trade is less today, with some purchases upon low-level basis.

Crude oil prices continue rising recently. MPOC expected Malaysian palm oil stocks to continue staying below 1.5 mln tonnes. Low expectations are bullish to the market, thus pulling up Dalian futures. Besides, China’s soybean oil stocks are just about more than 800,000 tonnes, and palm oil and rapeseed oil stocks are also small. Moreover, 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. And funds are active in going long under a weak U.S. dollar. Overall, short-term oils market is predicted to keep a strong trend. Participants are suggested to keep a lookout at fluctuations in the uptrend while bullish bullish, and keep a good balance in purchasing and selling.

Soybean oil: GB Grade I soybean oil is mainly priced at 9,570-9,810 CNY/tonne in domestic coastal areas, a rise of 50-170 CNY/tonne. (Tianjin traders 9570; Rizhao traders 9630; Zhangjiagang traders 9740; and Guangzhou traders 9790-9810). 

Palm oil: RBD palm olein is mainly priced at 8,120-8,200 CNY/tonne in coastal areas, up 40-70 CNY/tonne. (Tianjin traders 8140, up 60; Rizhao traders 8200, up 70; Zhangjiagang traders 8140, up 60; Guangzhou traders 8120-8140, up 40; and Xiamen not available).

Rapeseed oil: U.S. soybean futures continued sharp rises on Wednesday as storms forecast for production areas of Brazil would disrupt crop harvest activities, which would further tighten U.S. soybean supplies, as well as on a weak U.S. dollar under Biden administration’s $1.9 trillion stimulus package. Oils futures continue rising and post sharp gains on domestic commodity exchanges. Spot rapeseed oil prices settle up 60 CNY at 11,100-11,200 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, which may affect soybean crush later. And net crush margins for imported U.S. soybeans are at loss on Dalian. Besides, funds are active in going long under a weak U.S. dollar. Overall, short-term rapeseed oil market is predicted to strengthen at the high level in China.

Cottonseed oil: Cottonseed oil prices mostly further increase by 100-300 CNY/onne in China today. U.S. soybean futures further rose in overnight trade. Oils futures continue humming on Dalian Commodity Exchange today. Dalian palm oil and soybean oil futures respectively cross the 7,600 CNY/tonne and 8,800 CNY/tonne barrier in intraday trade. In the cash market, soybean oil rises by 50-170 CNY/tonne and palm oil represents an increase of 40-70 CNY/tonne. At the moment, soybean oil stocks only amount to more than 800,000 tonnes, with no pressure on supply side. And palm oil and rapeseed oil stockpiles also stay at a relatively low level. Moreover, soybean arrivals during the month of February and March could be only 6.2 mln tonne each month due to a delay in Brazilian soybean harvest and shipment, which may affect the operation rates in crushing mills. Thus, short-term bulk oils market will remain strengthening on the whole. In addition to this, a majority of oil plants have yet to resume the operation, which is bullish for cottonseed oil. Following the strength on 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 in China today. Grade I imported sunflower oil is offered at 11,500-12,200 CNY/tonne, and crude sunoil is offered at 11,500 CNY/tonne.

U.S. soybean futures rose on Wednesday as storms forecast for production areas of Brazil would disrupt crop harvest activities, which would further tighten U.S. soybean supplies, as well as on a weak U.S. dollar. Dalian oils futures continue advancing triumphantly today, of which palm olein and soybean oil successively broke through 7,600 CNY and 8,800 CNY, respectively. Spot soybean oil goes up 50-170 CNY/tonne and palm olein up 40-70 CNY/tonne. 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 keeping a strong trend.

Corn oil: Corn oil prices are mostly stable with a partial rise of 200 CNY in China today. Grade I corn oil price is 10,400-10,800 CNY/tonne (Shandong 10,500-10,800 CNY, up 300 CNY; Hebei 10,700; and 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. Chicago soybean futures continued gains on Wednesday, and Dalian oils futures continue advancing triumphantly today. 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 ¥6.45)