Today (Mar 8), the market for meals in China is shown as follows:

Soybean meal: U.S. soybean futures soared last Friday, and meal futures open high and rise on China’s Dalian Commodity Exchange today. Spot soybean meal prices settle up 30-100 CNY at 3,550-3,590 CNY/tonne, attracting some low-level purchases. (Tianjin 3580, Shandong 3560-3580, Jiangsu 3550-3590, Dongguan 3550-3560, and Guangxi 3650-3680.) 

As soybean import cost keeps increasing due to tight U.S. soybean supplies, crush margins for imported U.S. soybeans are at heavy loss on Dalian, so are net crush margins for U.S. Gulf and Brazilian soybeans. Moreover, some domestic oil mills will suspend production for a lack of soybeans in March and April as China’s soybean imports are forecast to be only 95 vessels or 6.2 mln tonnes in March. Meanwhile, some millers have also sold a large portion of March soybean meal contracts and choose to suspend offers to support prices. Millers are bullish about the market, thus bolstering meal prices. But Chinese producers are slow in replenishing hog stocks, which have been falling for two consecutive months, on a weakening trend in hog price after the festival and as the African swine fever is raising its head in some provinces. And table poultry stocks have also not recovered yet, and aquaculture has also not get started. Hence, soybean meal stocks keep building under thin trade after the festival, and some millers have started to quicken up the delivery or facing swelling inventories. In addition, oils prices are strong, which is bearish to meal prices. U.S. soybean prices will keep strong on ample liquidity as the U.S. Senate has passed the $1.9 trillion stimulus package, so short-term soybean meal prices will fluctuate to strengthen under the support of cost.

Rapeseed meal: U.S. soybean futures rose on Friday. Meal futures also post further gains after high opens on China’s exchanges today. Spot rapeseed meal is offered at 2,820-2,920 CNY/tonne in coastal regions, a rise of 40-60 CNY/tonne, in tepid trade. Rapeseed meal stocks have declined by 13% to 53,800 tonnes. Crush margins for rapeseed are at losses on domestic exchanges due to tight supply of Canadian old rapeseed. And net crush margins for imported soybean futures also have been negative currently. And soybean arrivals in March are forecast to be only 95 cargoes or 6.2 mln tonnes. Consequently, many oil plants could suspend the processing during March and April due to the shortfall in soybean supplies, buoying rapeseed meal market. However, African swine fever has resurged, raising farmer’s reluctance in replenishing hog stocks. And aquaculture has not begun yet. Both have caused a light trade in meal products and limited meals prices rises. But led by the high cost result from a steep rise in U.S. soybean price, rapeseed meal price is predicted to fluctuate to stay strong on the whole.

Imported fishmeal: Imported fishmeal prices steady with a decline in China today and can be traded through negotiation. Peruvian Standard SD with 65% protein content is 9,800-10,200 CNY/tonne, down 100-200 CNY from last Friday; Peruvian higher-quality SD with 65% protein content is 10,300-10,700 CNY/tonne, down 100-200 CNY; Peruvian higher-quality SD with 67% protein content is 10,800-11,100 CNY/tonne, down 100 CNY; and Peruvian Super Prime SD with 68% protein content is 11,300-11,600 CNY/tonne, down 100-200 CNY. China’s fishmeal stocks are picking up at a brisker pace with new cargoes arriving at ports currently, and domestic aquatic feed demand is still sluggish at present, so that domestic traders show weak sentiment to support prices. However, Peruvian offers keep firm as manufacturers have been pre-selling new-season fishmeal at a brisk pace, which is lending support to domestic traders and may limit price declines. Domestic fishmeal market is predicted to steady with slight adjustments in the near term.

Stocks at ports: Dalian 8,490 tonnes, Tianjin 580 tonnes, Shanghai 36,690 tonnes, Huangpu 41,630 tonnes, Fuzhou 13,980 tonnes, Fangchenggang 1,000 tonnes and 4,020 tonnes at other ports.

FOB quotes from foreign markets today: Apr/May shipments are quoted at 1,460 USD/tonne for Peruvian Standard with 65% protein content and at 1,680 USD/tonne for Peruvian super with 68% protein content. Chilean Standard with 65% protein content is quoted steadily at 1,430 USD/tonne, and super with 68% protein content at 1,600 USD/tonne.

Cottonseed meal: Cottonseed meal prices in China stay stable with a partial fluctuation of 20-50 CNY/tonne today. U.S. soybean futures soared on Friday. Meal futures also extend gains after opening high on Dalian Commodity Exchange today. Spot soybean meal is offered 30-100 CNY/tonne higher in coastal regions. The cost of importing soybean is climbing uninterruptedly due to tightening supplies of U.S. soybeans. And soybean arrivals in March are forecast to be 95 cargo ships totaling approximately 6.2 mln tonnes. In this case, many crushers would suspend the processing amid shortages of soybean during March and April. They look bullish on after-market, which buoys meals prices. Moreover, most of cottonseed oil plants have yet to resume the operation, bringing some support to cottonseed meal market. However, hog stocks have consecutively declined for two months due to the resurgence of African swine fever during the month of January and February. Also, aquaculture has not begun yet for the moment. Accordingly, cottonseed meal trade is tepid currently result from a lack of rigid demand, which curbs its market tentatively. Underpinned by higher cost amid a price hike in U.S. soybean, short-term cottonseed meal market is predicted to potentially fluctuate to stay strong.

(USD $1=CNY ¥6.48)