Today (Apr 6), the market for oilseeds and oils in China is shown as follows:

Oilseeds:

Imported soybean: Imported soybeans stocks are ample at domestic ports now, and China’s monthly soybean arrivals at ports are forecast to hit 10 mln tonnes in May-July, for Brazilian producers are harvesting and selling soybeans at a brisker pace. These are negative to imported soybean market in China. But the market demand has picked up as downstream buyers have consumed stocks and are making replenishment. This is lending support to the market. 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 are mixed today. Due to pricey cottonseed and consecutive losses in crush margins, oil plants 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. Therefore, short-term cottonseed market is predicted to move with fluctuations.

Oils: 

Summary: U.S. soybean futures jumped on Monday on U.S. supply concerns, and oils futures continue an uptrend on China’s Dalian Commodity Exchange today. In the spot markets, soybean oil goes up 80-150 CNY and palm oil up 50-80 CNY, both in thin trade after a rise in price.

China’s soybean crush fell 1.2% to 1.54 mln tonnes last week for a lack of beans or swelling meal inventories, so commercial soybean oil stocks also reduced further by nearly 8% to 620,000 tonnes. Meanwhile, port edible palm oil and rapeseed oil stocks are also low compared to this time in previous years. And crush margins for imported soybeans on Dalian are also at loss. Hence, fundamentals in the oils market remain bullish. In addition, a rise in U.S. soybeans will also lift the cost for soyoil. These combine to bolster the oils market to strengthen recently. But China’s soybean arrivals will climb in the second quarter as Brazilian soybean harvests and exports are progressing at a brisk pace. And palm oil production will see a rise seasonally. Besides, international crude oil prices have plunged, and Chinese investors have cooler risk appetite sentiment under volatile financial markets. These may add to fluctuations in the market. Short-term oils market may follow futures to strengthen in fluctuation in the near term.

Soybean oil: GB Grade I soybean oil is mainly priced at 9,360-9,510 CNY/tonne in domestic coastal areas, a rise of 80-150 CNY/tonne. (Tianjin trader 9360-9380; Rizhao trader 9390; Zhangjiagang trader 9510; and Guangzhou trader 9360-9380). 

Palm oil: RBD palm olein is mainly priced at 7,950-8,060 CNY/tonne in coastal areas, mostly up 50-80 CNY/tonne. (Tianjin trader 8000, up 80; Rizhao trader 8060, up 60; Zhangjiagang trader 7950, up 80; Guangzhou trader 7950-7970, up 50; and Xiamen 7980-8000, up 60).

Rapeseed oil: U.S. soybean futures jumped on Monday on concerns about U.S. supplies dwindling due to strong export demand and smaller-than-expected plantings. Rapeseed oil futures open high and rise on China’s Zhengzhou Commodity Exchange today. Spot rapeseed oil prices goes up 70-100 CNY to 10,790-11,040 CNY/tonne in coastal regions in thin trading.

China’s rapeseed oil stocks fell 12% year on year last week, albeit a weekly rise to 248,000 tonnes, and soybean oil stocks also keep declining. And net crush margins for soybean and rapeseed oil are both negative on board. These help bolster rapeseed oil prices to rise again, and the market is predicted to strengthen at the high level in the short term. But Brazilian producers are harvesting and selling soybeans at a brisker pace. And China’s Ministry of Commerce said it would release central reserves when necessary. Therefore, rapeseed oil market will fluctuate frequently at the high levels.

Cottonseed oil: Cottonseed oil prices mainly stay stable with a partial decrease of 100 CNY/tonne in China today. Brazil farmers have accelerated their pace in soybean harvest and export, which will lead soybean arrivals in the second quarter to creep up in China. Malaysian palm oil production is about to get a seasonally increase. Cottonseed oil price is curbed by a tumble on crude oil. However, concerns over tight supplies of U.S. soybean drove CBOT soybean futures to close higher on Monday again. Dalian oils futures extend the rally today. In the spot market, soybean oil rises by 80-150 CNY/tonne and palm oil represents an advance of 50-80 CNY/tonne. Nevertheless, cottonseed oil prices are offered higher but traded lower due to sluggish demand currently, in subdued trade. It is projected that short-term cottonseed oil market may follow bulk oils to fluctuate at the high level.

Sunflower oil: Sunflower oil prices steady with a partial decline in China today. Grade I imported refined sunflower oil is offered at 13,000-14,300 CNY/tonne; and crude sunflower oil is not offered.

China’s soybean arrivals will climb in the second quarter as Brazilian soybean harvests and exports are progressing at a brisk pace. And palm oil production will see a rise seasonally, international crude oil prices have plunged. In addition, more downstream buyers are using corn oil to substitute sunflower oil, which is bearish to sunflower oil market. However, U.S. soybean futures jumped on Monday on U.S. supply concerns, and oils futures continue an uptrend on China’s Dalian Commodity Exchange today. In the spot markets, soybean oil goes up 80-150 CNY and palm oil up 50-80 CNY, both in thin trade after a rise in price. Traders and millers have sentiment to support prices, which is positive to sunflower oil market. Overall, sunflower oil market is predicted to fluctuate at the high level in the short term.

Corn oil: Corn oil prices are stable with a partial decline in China today. Grade I corn oil is 11,800-12,500 CNY/tonne, a partial decline of 700 CNY. (Shandong 11,800-12,500 CNY, down 700; Hebei 11,800-12,000; Liaoning 11,800; and Sichuan no offer); and crude corn oil is offered at 10,000-10,800 CNY/tonne. (Henan 10,100; Hebei 10,000-10,200; Inner Mongolia 10,800; 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. 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 ¥6.55)