Today ( Sept. 11th), the market for oilseeds and oils in China is shown as follows:
Oilseeds:
Imported soybean: Prices for most imported soybeans keep stable, where non-GM imported soybean prices at 3,680-3,980 yuan/tonne, and GM imported soybeans are unquoted. Such ample supply and high stockpiles of imported soybeans no doubt will further inflict on the market. Narrowed price gap between domestic soybeans and imported ones undermines price competitiveness of imported soybeans, and limited delivery also puts bearish pressure on imported soybeans for distribution. Subject to trade disputes with the US, blocked imports of US soybeans and basically finished soybean sales in Brazil after November may contribute to lower-than-usual soybean arrivals during November and January next year. If such, forward soybean supply will be tight especially in the 4th quarter when Brazilian soybeans are sold out. That also leads to crushers' strong wills to soybean bids. On the whole, imported soybeans for distribution in the short run will probably trade sideways narrowly and steadily the time market supply & demand balance struggles in trade spats.
Cottonseed: Cottonseed increases by 0.01-0.04 yuan/kg partially today, since cottonseed supply is scarce in mainland China and cottonseed volumes from Xinjiang is lessened by inconvenient transportation and increasing transportation fee, whilst trade disputes have no end in sight. But prices of cottonseed oils and meals are weak in going up today under a slowdown on DCE, in addition to dismal crush profits, and lower quality of old cottonseeds than ever, as well as oil owners’ caution against those scattered washy new cottonseeds; therefore, cottonseed price is restricted in its upward trend and may suffer strong fluctuations in short term.
Oils:
Summary: Oils on DCE today still run below former closing though a further rise can be seen during the trading, accordingly, soybean oil on China’s market shows mixed prices and palm oil otherwise comes down in price. Overall turnover is still not much despite some deals upon lower prices. As freezing injury mainly happens to non-dominant crop growing areas, futures on DCE today come back to normal and even narrow gains after a wave of market speculation. Yet oil performance remains lackluster and shows little vitality to go further high, when stockpiling for packing oil is to finish within one week amid heavy soybean oil stockpiles at 1.59 Mln tonnes. Subject to trade disputes with the US, blocked imports of US soybeans and basically finished soybean sales in Brazil after November may contribute to lower-than-usual soybean arrivals during November and January next year. That is to say, oils overall will go on uptrend unless the trade war comes to a conclusion. Additionally, market expects production and stocks of US soybeans are to revise up in USDA report released tomorrow, on this point, buyers had better stay on the sidelines in case of any market volatility.
Soybean oil: Main prices for GB grade-one soybean oil in coastal areas stay at 5,720-5,830 yuan/tonne, some up 10-30 yuan/tonne and some down 20-30 yuan/tonne (Tianjin traders offer 5,740-5,750, Rizhao traders 5,720, Zhangjiagang traders 5,830, Guangzhou traders Y1901-110 or Y1901-100).
Palm oil: 24-degree palm oil prices in coastal areas range from 4,890 to 4,940 yuan/tonne, some down 30 yuan/tonne (Tianjin traders 4,900-4,910; Rizhao traders 4,940; Zhangjiagang traders 4,900, up 30; Guangzhou traders 4,890-4,900; Xiamen stops to quote).
Imported rapeseed oil: Prices for imported rapeseed oil edge up steadily, among which prices in coastal areas are 6,450-6,580 yuan/tonne, up 10-20 yuan/tonne (Fuzhiyuan in Dongguan, Guangdong offers 1901-240; Maple in Fangchenggang, Guangxi offers 1901-280; Fujian stops to quote). Helped by elevated import costs and estimated impressive soybean shortage from November to January in year 2019 amid trade conflicts, oils are now underpinned on the market. Add to that, unfavorable domestic consumption of soybean meal affiliated to devastating ASF also boosts oil performance. However, amply oil supply on China’s market and fishing oil stockpiling in the run-up to Mid-autumn Festival and National Day still put a cap on the upward space of rapeseed oil shorter term. Notably, rapeseed oil remains high at 0.53 Mln tonnes in stockpiles though a tad lower recently, soybean oil at 1.6 Mln tonnes and palm oil nearly 0.4 Mln tonnes later on a monthly average basis. Generally speaking, rapeseed oil is to maintain its mild uptrend when worries over forward soybean supplies are lingering amid trade spats, buyers thus had better stay on the sidelines and take expected bearish USDA reports on Wednesday night for guidance.
Cottonseed oil: An inadequate long-term soybean supply incurred by trade disputes creates a bullish market for domestic oils, so participants are inclined to hoard their existing stocks, especially when the cottonseed oil is small in output due to a low operation rate. But today oils on DCE slow down increasing speed, and spot price of soybean oil see fluctuations, some at 10-30. And cottonseed oil price is hard to soar due to its limited blending volume. Cottonseed oil price may go up steadily in fluctuations before the end of trade disputes.
(USD $1=CNY 6.87)
