Today (Mar 10), the market for meals in China is shown as follows:

Soybean meal: U.S. soybean futures closed higher on tight supplies, but meal futures continue falling on China’s Dalian Commodity Exchange today on arbitrage of long oils and short meal positions. Spot soybean meal prices settle down 10-30 CNY at 3,410-3,530 CNY/tonne, attracting some low-level purchases. (Tianjin 3500, Shandong 3460-3480, Jiangsu 3440-3470, Dongguan 3470-3500, and Guangxi 3500-3530.) 

Hog prices keep weakening in China with the occurrence of the African swine fever in certain regions, and hog stocks have been declining for two consecutive months as producers are slow in replenishing. In addition, aquaculture has also not get started. Soybean meal has thus been in thin trade after the festival and stocks have risen to 850,000 tonnes in coastal regions, so that some mills are choked up with swelling meal inventory. Besides, the oils market is also strong in China. These are bearish to meal prices. But stronger U.S. soybean price is lending support to the cost side. And some domestic processors will suspend production periodically in March and April due to small soybean imports in February and March, and some millers have also sold a large portion of March soybean meal contracts; hence, they have strong sentiment to prop up prices. Short-term soybean meal prices will follow futures to fluctuate and adjust, and buyers can wait for low and stable prices to make appropriate replenishment.

Rapeseed meal: USDA reported a higher-than-anticipated ending stock of U.S. soybean but also the lowest over the past seven years. CBOT soybean futures closed higher on Tuesday on the news and a delayed soybean harvest by rain in Brazil. But meal futures continue falling on China’s exchanges today. Spot rapeseed meal is offered at 2,740-2,840 CNY/tonne in coastal regions, a descent of 40-50 CNY/tonne, in tepid trade.

Market demand is seasonally sluggish now, leading to a subdued trade in meal products. In this case, soyoil mills are urging the deliveries as soybean meal stocks keep increasing, which weighs on rapeseed meal price. However, 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. On the other hand, Canadian old rapeseed is in short supply, causing the losses in crush margins for domestic rapeseed futures. This could impact later purchases of rapeseed. It is expected that short-term rapeseed meal price will modestly pick up in sight after a certain fall. Buyers can wait for low and stable prices to make proper replenishment.

Imported fishmeal: Imported fishmeal prices steady with a partial decline in China today and can be traded through negotiation. Peruvian Standard SD with 65% protein content is 9,800-10,100 CNY/tonne, down 100 CNY/tonne from Tuesday; Peruvian higher-quality SD with 65% protein content is 10,200-10,600CNY/tonne, down 100 CNY; Peruvian higher-quality SD with 67% protein content is 10,800-11,000 CNY/tonne, down 100 CNY; and Peruvian Super Prime SD with 68% protein content is 11,300-11,500 CNY/tonne, down 100 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. Meanwhile, presales of new-season fishmeal have slowed down the pace in Peru, so that local manufacturers have cut down prices. Domestic port traders have weakened down prices, so fishmeal market is predicted to steady with a slight decline in the near term.

Stocks at ports: Dalian 8,830 tonnes, Tianjin 590 tonnes, Shanghai 38,940 tonnes, Huangpu 40,760 tonnes, Fuzhou 14,310 tonnes, Fangchenggang 1,060 tonnes and 3,950 tonnes at other ports.

FOB quotes from foreign markets today: Apr/May shipments are quoted steadily at 1,440 USD/tonne for Peruvian Standard with 65% protein content and at 1,660 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 today. U.S. soybean futures further rose on Tuesday on tight supplies of soybean. But meal futures continue falling on Dalian Commodity Exchange today on profit taking. Spot soybean meal is offered 10-30 CNY/tonne lower in coastal regions. Hog prices keep moving down due to a resurgence of African swine fever in some regions, and hog stocks have consecutively declined for two months. Also, aquaculture has not begun yet for the moment. In this case, soybean meal inventories have uninterruptedly increased to 850,000 tonnes and even faced overhang in some regions. These are negative for meals prices. Besides, cottonseed meal trade is tepid currently result from a lack of rigid demand, which curbs its market tentatively. Moreover, most of cottonseed oil plants have yet to resume the operation and U.S. soybeans stay high, bringing some support to cottonseed meal market. Therefore, cottonseed meal market is predicted to potentially fluctuate in a short term but still stay strong in later period.

(USD $1=CNY ¥6.51)