I. Soybean

 

Price

 

Domestic soybean: A recent weak trend in futures is weighing on the bullish confidence, thus cooling the sentiment for higher prices and fueling the sentiment for profit-taking. Spot traders are loosening prices and its constraint on the demand side is growing. The majority of enterprises are cautious purchasers due to great risks at present and keep to the sidelines. Soybean prices in sales regions show weak upward momentum, which is negative to the market. But a sharp reduction in soybean production in regions like Jiangsu and Anhui provinces has led to shortages of some high-quality soybeans and highlighted a rise in their prices. Moreover, the central budget increased support for grain production this year, by enlarging incentive to major producing counties and providing subsidies to cultivated land fertility protection and to corn and soybean producers. The policy is also lending support to domestic soybean market. Overall, short-term soybean prices may fluctuate with a slight decline, and participants can keep an eye on arrivals of non-GM soybean arrivals at domestic ports and relevant policies.

 

Imported soybean: Imported soybean supply keeps increasing at domestic ports, of which Shandong ports receive nearly 3 vessels this week with the total stocks up to 130,000 tonnes (all for trade) and Nantong Port will also receive 1 cargo in March, while the market demand remains tepid and downstream buyers are not active. Participants hold wait-and-see mood, which is negative to the market. Meanwhile, U.S. soybean futures are easing from the high level on improving weather in South America and on cooling export demand for U.S. soybeans, so the support from the import cost side is subdued. In the short run, imported soybean market in China is predicted to steady with a slight decline amid dismal demand, and participants can keep an eye on imported soybean arrivals and demand in China.

 

China's Soybean Weekly Price（CNY/Tonne）
Region		Grade	This week	Last week	Variation
Northeast China	Heilongjiang	Domestic, GB Grade 3	5880	5960	-80
	Inner Mongolia	Domestic, GB Grade 3	5740	5840	-100
	Heilongjiang	Imported, Russia	N/A	N/A
East China	Jiangsu	Domestic soybean	7600	7700	-100
	Shandong	Imported, Argentina	N/A	N/A
		GM, PNW	5060	N/A
		GM, U.S. GULF	5100	N/A
North China	Tianjin	Non-GM, Ethiopia	5400	5450	-50
		Non-GM, Ukraine	5700-5950	5800	-100
		Non-GM, Canada	6150	N/A
		GM, PNW	N/A	N/A
		GM, U.S. GULF	N/A	N/A
National average		Domestic soybean	5880	5960	-80
		Imported soybean	4900	4920	-20

 

 

 

 

Crush: Operation rates see a slight rise in China this week (Mar 13-19). Soybean crush at domestic mills totals 1,568,610 tonnes (meal 1,239,202 tonnes and oil 298,036 tonnes), up 119,910 tonnes or 8.27% from 1,448,700 tonnes last week. Meanwhile, operation rates (capacity utilization) are 44.23%, up 3.38% from 40.85% in the previous week. Soybean crush is expected to be 1.52 mln tonnes next week and 1.62 mln tonnes in week 13.

 

Soybean crush nationwide is estimated at 6.89 mln tonnes in March at current utilization rate, against the 4.682 mln tonnes in the previous month and 6.5783 mln tonnes a year earlier.

 

In the crop year of 2020/21 (from Oct 1st, 2020), China’s soybean crush totals 43,105,954 tonnes, up 4,562,354 tonnes or 11.83% from 38,543,600 tonnes a year earlier.

 

In the calendar year of 2021 (from Jan. 1st, 2021), China’s soybean crush amounts to 17,615,016 tonnes, up 1,105,059 tonnes or 6.69% from 16,509,957 tonnes of the corresponding period in 2020.

 

Inventory: Soybean stocks continue reducing this week as soybean crush goes up to 1.56 mln tonnes and the volume put into mill stock remains small. In the week as of Mar 19, China’s imported soybean stocks in coastal regions total 4,280,500 tonnes, down 118,200 tonnes by 2.69% from 4,398,700 tonnes last week and up by 77.26% from 2,414,800 tonnes from a year earlier. 

 

Arrivals and the outlook: According to Cofeed, soybean import is predicted to be 95 cargoes or 6.202 mln tonnes for March, 7.6 mln tonnes for April, 10.1 mln tonnes for May, 10.3 mln tonnes for June and 9.8 mln tonnes for July.

 

II. Soybean Meal

 

Price: Domestic soybean meal prices continue the decline this week (Mar 15-19). As of this Friday, prices settle at 3,220-3,270 CNY/tonne in domestic coastal regions, a decline of 40-100 CNY/tonne. 

 

China's Soybean Meal Weekly Price  (CNY/Tonne)
Region		This week	Last week	Variation
Northeast China	Jilin	3,390	3,420	-30
North China	Tianjin	3,270	3,340	-70
	Hebei	3,270	3,320	-50
Central China	Hubei	3,310	3,390	-80
	Henan	3,290	3,360	-70
East China	Shandong	3,220	3,310	-90
	Jiangsu	3,220	3,315	-95
	Zhejiang	3,240	3,315	-75
	Shanghai	3,220	3,320	-100
	Fujian	3,360	3,460	-100
	Anhui	3,270	3,340	-70
South China	Guangdong	3,220	3,290	-70
	Guangxi	3,240	3,340	-100
National average		3,243	3,327	-84

 

 

Inventory: Soybean meal stocks slightly increase this week on higher soybean crush volume and a slow recovery in the demand. In the week as of Mar 19, China’s soybean meal stocks in coastal regions are 745,300 tonnes, up 600 tonnes by 0.08% from 744,700 tonnes last week and also up 69.19% from 440,500 tonnes from a year earlier. Some domestic millers have a plan for downtime periodically in March and April due to negative crush margins and a delay in soybean harvests and shipments in Brazil and there will be a recovery in aquaculture, so soybean meal stocks are expected to continue a reduction.

 

 

III. Soybean Oil

 

Price: Domestic soybean oil prices ease this week (Mar 15-19). As of this Friday, the price for GB Grade I settles at 9690-9860 CNY/tonne in domestic coastal regions, a sharp decline of 450-540 CNY/tonne. The overall nationwide price index is 9820 CNY/tonne, a weekly decline of 470 CNY or 4.57% from 10,290 CNY/tonne last week.

 

China's Soybean Oil Weekly Price (CNY/Tonne)
Region		Grade	This week	Last week	Variation
South China	Guangzhou	GB Grade 1	9,740	10280-10330	540-590
		GB Grade 3	N/A	N/A
North China	Qinhuangdao, Hebei	GB Grade 1	N/A	10,250
		GB Grade 3	N/A	10,150
	Tianjin	GB Grade 1	9690-9710	10160-10180	-470
		GB Grade 3	N/A	N/A
East China	Rizhao, Shandong	GB Grade 1	N/A	10,160
		GB Grade 3	N/A	N/A
	Zhangjiagang, Jiangsu	GB Grade 1	9,860	10330-10360	470-500
		GB Grade 3	N/A	N/A
National average		GB Grade 1	9,810	10,330	-520
		GB Grade 3	9,860	10,280	-420

 

 

Inventory: Soybean oil stocks continue a smaller decline this week, as soybean crush remains low in spite of a rise and the consumption is at a brisk pace. In the week ending Mar 19, China’s soybean oil commercial inventories total 730,800 tonnes, down 17,450 tonnes by 2.33% from 748,250 tonnes last week, down 142,800 tonnes by 16.35% from 873,600 tonnes month on month, and down 661,300 tonnes by 47.5% from 1,392,100 tonnes year on year. And the five-year (2016-2020) average at the same period is 1,188,000 tonnes.