Today (Mar 30), the market for oilseeds and oils in China is shown as follows:

Oilseeds:

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.

Cottonseed: Cottonseed prices in China keep steady with a partial decrease of 0.02-0.08 CNY/kg today. Cottonseed crushing mills keep facing losses on account of early excessive growth in cottonseed price. In this case, they are cautious in making purchases in a bid to avoid risk, and mainly fulfill previous contracts or consume inventories. Thus, cottonseed trading is limited in spot market, and traders tend to dampen the price. 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. Cottonseed market is predicted to continue fluctuating due to a steep decline in bulk oils prices.

Oils: 

Summary: The weather forecast was beneficial for spring planting in U.S. soybean fields, and the market projected a much higher area in soybean planting this year. Meanwhile, U.S. soybean exports were cooling, and U.S. dollar rose to a four-month high. Hence, U.S. soybean futures continued a decline on Monday. But oils futures slow down losses and fluctuate to adjust on China’s Dalian Commodity Exchange today, of which is palm olein is stronger than soybean oil. In the spot markets, soybean oil fluctuates by 10-30 CNY/tonne and palm oil mostly goes up 30-40 CNY, both in thin trade.

China’s soybean crush fell 0.3% to 1.56 mln tonnes last week. And soybean oil and palm oil stocks are both on a decline, of which the former has fallen to to multi-year low of less than 700,000 tonnes. In addition, crush margins for imported soybeans are at heavy loss on Dalian, so that millers are supporting prices. But Brazilian traders are ramping up soybean marketing, so that China’s monthly soybean arrivals at ports are forecast to hit 10 mln tonnes in May-July. And China’s Ministry of Commerce said it will release central reserves timely. Besides, investors have cooled down risk appetite sentiment due to a volatile global financial market, which is also curbing domestic oils movements. Overall, short-term domestic oils market is still in fluctuation and retreat, and participants can wait or keep light stockpiles for the moment.

Soybean oil: GB Grade I soybean oil is mainly priced at 9,290-9,590 CNY/tonne in domestic coastal areas, fluctuating by 10-30 CNY/tonne. (Tianjin traders 9290-9310; Rizhao traders 9370; Zhangjiagang traders 9590; and Guangzhou traders 9340). 

Palm oil: RBD palm olein is mainly priced at 7870-7990 CNY/tonne in coastal areas, mostly up 10-40 CNY/tonne. (Tianjin traders 7920-7930, up 30; Rizhao traders 7990, up 40; Zhangjiagang traders 7870, up 40; Guangzhou traders 7870-7880, up 40; and Xiamen 7930, up 10).

Rapeseed oil: U.S. soybean futures closed lower last Friday, and rapeseed oil futures fluctuate on China’s Zhengzhou Commodity Exchange today. Spot rapeseed oil prices steady at 10,500-10,750 CNY/tonne in coastal regions in thin trading.

Soybean oil, palm oil and rapeseed oil stocks are all lower than this time in previous years, so the supply of oils is not under pressure in domestic market. And net crush margins for soybean and rapeseed oil are both negative on board, which is also supporting rapeseed oil market. But China’s monthly soybean arrivals at ports are forecast to hit 10 mln tonnes in May-July. The pressure from South American soybean market is growing, and crude oil has also sharply declined, in addition to a volatile domestic financial market, so investors are closing long positions and exiting the market. Oils futures expand losses again in afternoon session, so this round of decline has yet come to an end, and buyers can wait for the moment.

Cottonseed oil: Cottonseed oil prices partly keep steady and partly slump 100-400 CNY/tonne in China today. CBOT soybean futures further fell on Monday. Oils futures slow declines and fluctuate slightly on Dalian Commodity Exchange today. Spot soybean oil fluctuates by 10-30 CNY/tonne. Investors cool down their risk appetite sentiment against the backdrop of volatile global financial market, which also weighs on oils market. Besides, cottonseed oil is in tepid trade due to sluggish demand currently, and some factories mainly fulfill previous contracts. This has dragged down cottonseed oil price to keep edging down. Oils futures expand losses again after noon. It is projected that short-term cottonseed oil market may follow bulk oils to fluctuate to fall. Buyers can tentatively take a wait-and-see attitude.

Sunflower oil: Sunflower oil prices steady in China today. Grade I imported refined sunflower oil is offered at 13,000-14,300 CNY/tonne; and crude sunflower oil is 13,000 CNY/tonne.

China’s soybean crush fell 0.3% to 1.56 mln tonnes last week, and soybean oil stocks reduced to hit a multi-year low of less than 700,000 tonnes. Domestic palm oil stocks are also on a decline. In addition, crush margins for imported soybeans on Dalian are at heavy loss, so that millers have sentiment to support prices. But as sunflower oil prices remain high, downstream buyers tend to choose corn oil as a substitute, which is negative to the market. Overall, sunflower oil market is predicted to fluctuate to keep its strength in the short term.

Corn oil: Corn oil prices are stable with a partial decline in China today. Grade I corn oil is 12,000-12,500 CNY/tonne, down 300 CNY. (Shandong 12,000-12,500 CNY; Hebei no offer; Liaoning 12,200, down 300; and Sichuan no offer); and crude corn oil is offered at 10,100-11,000 CNY/tonne. (Henan 10,100; Hebei 11,000; Inner Mongolia 11,000; and Heilongjiang no offer).

Downstream purchasers are acting with caution and keep themselves to sidelines since corn oil prices have climbed to a high level. And the weak demand is leading to lower trading price than offers in corn oil market, so some millers are mainly carrying out outstanding contracts. Besides, the weak trend in rival sunflower oil price may also affect corn oil market. But domestic corn millers are still supporting prices due to high corn germ prices, which is bullish to the market. Overall, corn oil market in China is predicted to fluctuate to downside in the near term.

(USD $1=CNY ¥6.56)