Today (Nov 20), the market for oilseeds and oils in China is shown as follows:
Oilseeds:
Imported soybean: U.S. Gulf soybeans are offered at 4,850-4,900 CNY/tonne and Uruguayan soybeans at 4,900-4,950 CNY/tonne at Shandong port today. Domestic purchasers tend to choose domestic soybeans and have little appetite for imported soybeans. And U.S. democratic candidate Joe Biden won the presidential election, which will make for a detente in relations between China and the US. In addition, China is still purchasing soybeans from the U.S. and Brazil, which will increase the arrivals at ports and thus be negative to imported soybean market. However, imported soybeans are in tight supplies, in addition to strict commodity inspections at ports, which is bolstering the market. Overall, short-term imported soybean market is predicted to steady.
Cottonseed: Cottonseed prices decrease by 0.5 CNY/kg in several regions today. The delivery of cottonseed is still under impact of the COVID-19 outbreak in Xinjiang. Moreover, cottonseed crushing mills keep facing losses as cottonseed price remains too high, and some mills have halted the purchase and have intention to force price down. Besides, cottonseed output this year is lower than the previous year and cottonseed oil stays firm, which supports cottonseed market. It is expected that cottonseed price will fluctuate narrowly in a short term and keep strengthening on the whole.
Oils:
Summary: U.S. soybean futures closed further higher on Thursday. And on China’s Dalian Commodity Exchange today, soybean oil futures post slight gains but fail to steady on the key 8,000, while palm olein fluctuates to decline. In the spot markets, soybean oil goes up 10-50 CNY and palm oil down 50-60 CNY, both in tepid trade.
Malaysia’s palm oil stocks may be further pulled down by low production and are expected to mount at a relatively slow pace next year. Moreover, drought has raised concerns over soybean production in South America, and U.S. soybean futures maintain at a high level of 1,180 cents, which keeps lifting the import cost. Meanwhile, domestic soybean oil stocks are declining under extremely high soybean crush, and palm oil and rapeseed oil inventories are also low. These together keep oils prices at high levels. However, Chinese yuan is on an uptrend these days, and domestic crushers also maintain soybean crush at a high level due to huge soybean imports. Besides, some investors start to take profits after Dalian oils futures keep climbing to 8,000, which slows down gains today. Therefore, it is necessary to prevent risks of short-term technical corrections in the wake of consecutive sharp gains while being bullish.
Soybean oil: GB Grade I soybean oil is mainly priced at 8,320-8,370 CNY/tonne in domestic coastal areas, a rise of 10-50 CNY/tonne. (Tianjin traders 8320; Rizhao traders 8350; Zhangjiagang traders 8370; and Guangzhou traders 8340-8370).
Palm oil: RBD palm olein is mainly priced at 7,030-7,160 CNY/tonne in coastal areas, mostly down 50-60 CNY/tonne. (Tianjin traders 7100, down 50; Rizhao 7160, down 60; Zhangjiagang traders 7050, down 50; Guangzhou traders 7030-7050, down 50; and Xiamen not available).
Rapeseed oil: U.S. soybean futures closed further higher on Thursday, but rapeseed oil futures decline in fluctuation on China’s Zhengzhou Commodity Exchange today. Spot rapeseed oil prices go down 50-60 CNY to 10,290-10,440 CNY/tonne in coastal regions in tepid trading.
HUAWEI Meng Wanshou will have a higher possibility of being release, because Joe Biden’s elected as president is conducive to a detente between China and the United States. Chinese crushers is keeping soybean crush at an extremely high level due to adequate feedstock supplies. Moreover, the consumption of rapeseed oil is also affected by its huge price spread with soybean oil and palm oil. Hence, rapeseed oil prices follow futures to decline and adjust. However, China’s rapeseed oil stockpiles are only 213,000 tonnes now, and soybean oil stocks are also falling and palm oil inventories also remain low. Meanwhile, there is no pressure in oils supplies due to a rise in demand from feed this year. These will support rapeseed oil prices to stay at the high level.
Cottonseed oil: Cottonseed oil prices get another increase of 50 CNY/tonne in individual regions today. U.S. soybean stays at a high of 1,180 cents as the prolonged dryness in South America raises concerns over soybean production, pushing up the cost of importing soybean. U.S. soybean futures further rose on Thursday. Soybean oil futures continue rising today on China’s Dalian Commodity Exchange but fail to steady on 8,000, with marginal gains compared to the previous close. In the cash market, soybean oil grows by 10-50 CNY/tonne. It will see a consecutive decrease in soybean oil stocks despite super high level of soybean crush. Also, the inventory of palm oil and rapeseed oil stays relatively low. Bulk oils market will maintain the high level. Additionally, cottonseed crushing mills keep facing losses as cottonseed is still pricey, so they intend to prop up prices. It is predicted that short-term cottonseed oil market will still keep a strengthening trend.
Sunflower oil: Sunflower oil prices climb in China today, mostly with a rise of 100-600 CNY/tonne. Grade I imported sunflower oil is offered at 10,000-10,600 CNY/tonne; crude sunoil is offered at 9,700-9,800 CNY/tonne.
U.S. soybean futures rose in overnight trade, and soybean oil futures also post gains on China’s Dalian Commodity Exchange today and spot soybean oil prices are also higher. Moreover, global vegetable oils are in tight supplies, and domestic soyoil, palm oil and rapeseed oil stocks are also low. Besides, sunflower oil prices stay at high levels in foreign markets, in addition to a production reduction in sunflowerseed. These are supporting sunflower oil prices to continue rises. Domestic milers are propping up sunflower oil prices, which is good to the market. Overall, short-term sunflower oil market is predicted to continue a strong trend.
Corn oil: Corn oil prices are mostly stable with a partial decline in China today. Grade I corn oil is offered at 10,000-10,500 CNY/tonne, up 100 CNY/tonne. (Shandong 10,200-10,500 CNY/tonne, up 100 CNY/tonne; Hebei 10,200; Liaoning 10,000; Sichuan 10,100); crude corn oil is offered at 8,300-8,600 CNY/tonne. (Hebei 8,350-8,600 CNY/tonne; Henan 8,500; Inner Mongolia 8,300).
Chinese millers still have sentiment in propping up prices as the cost remains high, which is positive to the market. But spot corn oil stays at high prices. And its supplies are increasing due to a pickup in operation rates, whilst downstream buyers have little appetite under dismal demand. These are pressuring the market. Overall, short-term corn oil market is predicted to decline to adjust but also to keep a strengthening trend in fluctuation.
(USD $1=CNY ¥6.58)