Today (Apr 21), the market for oilseeds and oils in China is shown as follows:

Oilseeds:

Imported soybean: China may bring in 27 mln tonnes of soybeans from April to June, as Brazil is now marketing and exporting soybeans at a brisker pace. And domestic downstream buyers inactive in purchase due to declining prices, so that the demand for imported soybeans is not strong and port shipments also remain tepid. These are negative to domestic imported soybean market. However, high-level U.S. soybean prices are lending support to the cost side for imported soybeans. In a hybrid of the bull and the bear, imported soybean market in China is predicted to fluctuate with a weakening trend in the short run.

Cottonseed: Cottonseed prices in China mainly keep unchanged and in part increase by 0.02 CNY/kg today. Cottonseed production this year has been 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. But 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. Therefore, it is expected that short-term cottonseed price still keeps fluctuating.

Oils: 

Summary: U.S. soybean futures soared to their highest in over six years on tightening supplies supported cash market and attracted speculative buying. And oils futures also surge on China’s Dalian Commodity Exchange today. In the spot markets, soybean oil goes up 30-100 CNY/tonne and palm oil up 130-190 CNY.

BMD palm oil futures rose sharply for consecutive sessions and refreshed the latest high, bolstered by a month-on-month rise in exports in the first twenty days of April. Meanwhile, domestic commercial soybean oil stocks have been falling for a 8^th straight week to a low level of 570,000 tonnes, and port edible palm oil stocks have also dropped 4% weekly to 420,000 tonnes; hence, fundamentals remain bullish in the oils market. Besides, crush margins for imported soybeans are still at loss, and millers have stronger sentiment to hike prices. These help oils prices to welcome gains. The market has already put its focus on planting weather for U.S. soybeans under tightening supplies, so that China’s oils market will probably strengthen in the short term under high import cost. However, soybean arrivals at China’s ports are increasing amid the ongoing marketing season in South America, and Chinese crushers will continue picking up operation rates in coming two weeks. In addition, palm oil production in main producing countries will see a rise in the second quarter. These will add to fluctuations in the market. 

Soybean oil: GB Grade I soybean oil is offered at 9,390-9,640 CNY/tonne in domestic coastal areas, mostly up 30-100 CNY/tonne. (Tianjin trader 9430-9460; Rizhao trader 9450; Zhangjiagang trader 9640; and Guangzhou trader 9390-9420). 

Palm oil: RBD palm olein is mainly priced at 8,180-8,410 CNY/tonne in coastal areas, mostly up 110-150 CNY/tonne. (Tianjin trader 8360-8380, up 110; Rizhao trader 8410, up 190; Zhangjiagang trader 8210, up 130; Guangzhou trader 8180, up 130; and Xiamen 8300, up 150).

Rapeseed oil: U.S. soybean futures closed higher on Tuesday, and rapeseed oil futures open high and rise on China’s Zhengzhou Commodity Exchange today. Spot rapeseed oil prices goes up 190-250 CNY to 10,930-11,160 CNY/tonne in coastal regions in thin trading.

Canada booked at least two shipments of Ukrainian rapeseed for the first time on tightened supplies. China is under no pressure in oils supplies, as soybean oil, palm oil and rapeseed oil stocks are at lows for this time in years. And Chinese millers may make smaller-tan-expected rapeseed purchases from July to August, as crush margins are at heavy loss. These together bolster short-term rapeseed oil price to keep its strength. However, China may bring in 27.6 mln tonnes of soybeans from April to June amid the ongoing marketing season for soybeans from South America, and palm oil production in main producing countries will see a rise entering the second quarter. Besides, consumption on rapeseed oil is also affected by its huge price spread with soybean oil and palm oil. Hence, rapeseed oil prices will fluctuate frequently at the high level.

Cottonseed oil: Cottonseed oil prices in part increase by 50-100 CNY/tonne in China today. Oils futures rise sharply on Dalian Commodity Exchange today. In the cash market, soybean oil increases by 30-100 CNY/tonne and palm oil jumps by 130-190 CNY/tonne. An uninterrupted rise in U.S. soybean futures has caused persistent losses in crush margins for imported soybean futures on China’s Dalian exchange, so bulk oils remain bullish on fundamentals, offering a support to domestic oils market. For the moment, cottonseed oil is offered higher but traded lower due to sluggish demand, in subdued trade. This will restrain the upward momentum of oils market. It is expected that short-term cottonseed oil market will fluctuate to stay strong following the continuous gains in bulk oils market.

Sunflower oil: Sunflower oil prices steady and some mixed in China today. Grade I imported refined sunflower oil is offered at 11,900-14,300 CNY/tonne; and crude sunflower oil is not offered.

Soybean arrivals at China’s ports are increasing amid the ongoing marketing season in South America, and Chinese crushers will continue picking up operation rates in coming two weeks. In addition, palm oil production in main producing countries will see a rise in the second quarter. These combine to drag down short-term oils prices. Moreover, more downstream buyers choose corn oil as a substitute, which is also negative to sunflower oil market. However, Ukraine sunflower oil prices are climbing amid a rise in global crude oil and vegetable oil prices, so that import cost has been lifted for Chinese importers. Add to that, Dalian oils futures are also surging today, and spot soybean oil and palm oil prices are also higher, which is bullish to sunflower oil market. Overall, short-term sunflower oil market is predicted to fluctuate at the high level in the short term.

Corn oil: Corn oil prices are steady with a partial decline in China today. Grade I corn oil is 11,000-11,500 CNY/tonne, down 500 CNY. (Shandong 11,000-11,500 CNY, down 500; Hebei 11,000; Liaoning 11,200; and Sichuan no offer); and crude corn oil is offered at 9,800-10,100 CNY/tonne. (Henan 10,100; Hebei 9,800-10,000; Inner Mongolia 9,800; 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, so that spot corn oil prices are declining. Besides, the slack season for oils now is also affecting spot prices, and sunflower oil, the rival of corn oil, also sees a decline in price under pressure. But corn germ prices are rising, thus lending support to the cost side. Moreover, domestic commercial soybean oil stocks have been falling for a 8^th straight week to a low level of 570,000 tonnes, and port edible palm oil stocks have also dropped 4% weekly to 420,000 tonnes; hence, fundamentals remain bullish in the oils market. Besides, crush margins for imported soybeans are still at loss, and millers have stronger sentiment to hike prices. These may bring support to corn oil market. Overall, Overall, corn oil market in China is predicted to fluctuate to downside in the near term.

(USD $1=CNY ¥6.50)