I. Soybean

 

Price

 

Domestic soybean: A majority of soybean producers have a stronger will to sell stocks now as they need to cash out in preparation for the spring ploughing. And prices for all kinds of byproducts suffer a sharp decline as residents and large canteens cut the demand for bean products when they have wide range of choice with the marketing of traditional vegetables in spring. And 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 domestic soybean prices may still have some downside space, and participants can keep an eye on arrivals of non-GM soybean arrivals at domestic ports and relevant policies.

 

Imported soybean: Port soybean stocks decrease as trade soybeans at Shandong ports are partially flowing into local crushing mills, which is lending support to the market. But downstream demand is tepid and buyers are not active, and the overall market is in wait-and-see mood. Moreover, U.S. soybean futures are easing on cooling export demand as global soybean demand turn to South American markets, so the support from the import cost side is subdued. Meanwhile, China’s huge soybean arrival prospects, as Brazilian soybeans are flowing into the market, will also be negative to local imported soybean prices. Overall, imported soybean market in China is predicted to fluctuate in the short run, 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	5840	5880	-40
	Inner Mongolia	Domestic, GB Grade 3	5700	5740	-40
	Heilongjiang	Imported, Russia	N/A	N/A
East China	Jiangsu	Domestic soybean	7600	7600	0
	Shandong	Imported, Argentina	N/A	N/A
		GM, PNW	4900	5060	-160
		GM, U.S. GULF	5060	5100	-40
North China	Tianjin	Non-GM, Ethiopia	5450	5400	50
		Non-GM, Ukraine	5950	5700-5950	250
		Non-GM, Canada	6050	6150	-100
		GM, PNW	N/A	N/A
		GM, U.S. GULF	N/A	N/A
National average		Domestic soybean	5840	5880	-40
		Imported soybean	4960	4900	60

 

 

 

 

Crush: Operation rates decline as expected in China this week (Mar 20-26). Soybean crush at domestic mills totals 1,563,980 tonnes (meal 1,235,544 tonnes and oil 297,156 tonnes), down 4,630 tonnes or 0.30% from 1,568,610 tonnes last week. Meanwhile, operation rates (capacity utilization) are 44.10%, down 0.13% from 44.23% in the previous week. Soybean crush is expected to be 1.58 mln tonnes next week and 1.68 mln tonnes in week 14.

 

Soybean crush nationwide is estimated at 6.91 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 44,639,934 tonnes, up 4,620,234 tonnes or 11.54% from 40,019,700 tonnes a year earlier.

 

In the calendar year of 2021 (from Jan. 1st, 2021), China’s soybean crush amounts to 19,148,996 tonnes, up 1,162,939 tonnes or 6.47% from 17,986,057 tonnes of the corresponding period in 2020.

 

Inventory: Soybean stocks continue reducing this week as the volume put into mill stock remains small. In the week as of Mar 26, China’s imported soybean stocks in coastal regions total 3,947,600 tonnes, down 332,900 tonnes by 7.78% from 4,280,500 tonnes last week and up by 63.84% from 2,409,300 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, 10.2 mln tonnes for May, 10 mln tonnes for June and 9.6 mln tonnes for July. The data will be updated every week based on buying and shipment.

 

II. Soybean Meal

 

Price: Domestic soybean meal prices bounce this week (Mar 22-26). As of this Friday, prices settle at 3,280-3,350 CNY/tonne in domestic coastal regions, a rise of 20-60 CNY/tonne. 

 

China's Soybean Meal Weekly Price  (CNY/Tonne)
Region		This week	Last week	Variation
Northeast China	Jilin	3,450	3,390	60
North China	Tianjin	3,350	3,270	80
	Hebei	3,340	3,270	70
Central China	Hubei	3,330	3,310	20
	Henan	3,310	3,290	20
East China	Shandong	3,270	3,220	50
	Jiangsu	3,250	3,220	30
	Zhejiang	3,260	3,240	20
	Shanghai	3,240	3,220	20
	Fujian	3,380	3,360	20
	Anhui	3,300	3,270	30
South China	Guangdong	3,280	3,220	60
	Guangxi	3,310	3,240	70
National average		3,299	3,243	56

 

 

Inventory: Soybean meal stocks fractionally decrease this week on a slight reduction soybean crush volume and brisker shipments under a slow recovery in the demand. In the week as of Mar 26, China’s soybean meal stocks in coastal regions are 743,100 tonnes, down 2,200 tonnes by 0.30% from 745,300 tonnes last week and also up 128.15% from 325,700 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 are just like riding a roller coaster this week (Mar 20-26), for Grade I soybean oil price rose to 9,970-10,160 CNY/tonne in the first half of the week (a rise of 230-310 CNY from last Friday) and later it plunged to 9,380-9,630 CNY/tonne (a decline of 540-590 from the week high), with an overall decline of 230-360 CNY from last Friday. The overall nationwide Grade I soyoil price index is 9,520 CNY/tonne, a weekly decline of 300 CNY or 3.05% from 9,820 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	9,380	9,740	-360
		GB Grade 3	N/A	N/A
North China	Qinhuangdao, Hebei	GB Grade 1	N/A	N/A
		GB Grade 3	N/A	N/A
	Tianjin	GB Grade 1	9380-9430	9690-9710	280-310
		GB Grade 3	N/A	N/A
East China	Rizhao, Shandong	GB Grade 1	N/A	N/A
		GB Grade 3	N/A	N/A
	Zhangjiagang, Jiangsu	GB Grade 1	9,630	9,860	-230
		GB Grade 3	N/A	N/A
National average		GB Grade 1	9,550	9,810	-260
		GB Grade 3	9,500	9,860	-360

 

 

Inventory: Soybean oil stocks continue falling this week as the output reduces following a decline in soybean crush. In the week ending Mar 26, China’s soybean oil commercial inventories total 673,100 tonnes, down 57,700 tonnes by 7.9% from 730,800 tonnes last week, down 174,300 tonnes by 20.57% from 847,400 tonnes month on month, and down 648,430 tonnes by 49.07% from 1,321,530 tonnes year on year. And the five-year (2016-2020) average at the same period is 1,157,500 tonnes.