Today (Jan 15), the market for meals in China is shown as follows:
Soybean meal: U.S. soybean futures sharply rose on Thursday on robust exports, but meal futures move lower after high open and post losses in afternoon trade on China’s Dalian Commodity Exchange today. Spot soybean meal prices steadily fluctuate by 10-30 CNY to stay at 3,800-4,150 CNY/tonne in coastal regions, still in tepid trade. (Tianjin 4150, Shandong 4070-4100, Jiangsu 4020-4040, Dongguan 3800-3860, and Guangxi 3790-3830.)
Soybean import cost remains high on strong U.S. soybean prices, so that net crush margins for U.S. soybeans have been at loss on Dalian. Soybean meal is in tightening supply in northern China on a surge in demand as buyers are rushing to stock up for the Spring Festival, and local millers are limiting sales and southern millers are shipping meal cargoes to northern markets. Some oil mills have sold out spot meal for January. Trucks are difficult to hunt under containment measures against the COVID-19, and soybean meal is in tight spot supply. These combine to make soybean meal prices keep firm. But downstream buyers are getting cautious about current high prices, which is bearish to the market, so short-term soybean meal prices are fluctuating to adjust at high levels. Supported by strong U.S. soybean prices and as domestic buyers are stocking up for the festival, soybean meal market in China is predicted to have little downside space. And as Dalian futures are in fluctuation, buyers can stay on the sidelines.
Rapeseed meal: Soybean futures soared on CBOT on strong export. Rapeseed meal futures fall back modestly on Zhengzhou Commodity Exchange due to profit taking. Spot rapeseed meal is offered at 2,910-3,010 CNY/tonne in coastal China today, a drop of 10-20 CNY/tonne, in tepid trade. Soybean crush may get back to more than 1.9 mln tonnes per week due to an adequate supply of soybean. Besides, aquaculture has basically ceased, and poultry stocks are low attributed to substantial losses in breeding margins previously. In this case, feed consumption slows down, slackening demand for meals. Thus, rapeseed meal inventories continue rising. These have together weighed on rapeseed meal price. But the cost of importing soybean remains high, and rapeseed crush maintains the low level amid lower imports, which may buoy rapeseed meal market. It is predicted that short-term rapeseed meal price may fluctuate at the high level.
Imported fishmeal: Imported fishmeal prices are stable today and can be traded through negotiation. Peruvian Standard SD with 65% protein content is 10,000-10,200 CNY/tonne; Peruvian higher-quality SD with 65% protein content is 10,400-10,700 CNY/tonne; Peruvian higher-quality SD with 67% protein content is 11,000-11,100 CNY/tonne; and Peruvian Super Prime SD with 68% protein content is 11,500-11,600 CNY/tonne. Domestic fishmeal stocks keep falling at present so that traders have some sentiment to prop up or raise prices. But the demand for fishmeal is subdued as aquaculture turns slack in winter and the recovery in hog herd is limited now, which is capping the upward space in domestic fishmeal market. Overall, domestic fishmeal prices are expected to steady with slight adjustments in the near term.
Stocks at ports: Dalian 4,270 tonnes, Tianjin 500 tonnes, Shanghai 11,040 tonnes, Huangpu 44,680 tonnes, Fuzhou 12,650 tonnes, Fangchenggang 1,100 tonnes and 3,400 tonnes at other ports.
FOB quotes from foreign markets today: Jan/Feb shipments are quoted at 1,340 USD/tonne for Peruvian Standard with 65% protein content and at 1,560 USD/tonne for Peruvian super with 68% protein content. Chilean Standard with 65% protein content is quoted steadily at 1,370 USD/tonne, and super with 68% protein content at 1,600 USD/tonne.
Cottonseed meal: Cottonseed meal prices in part rise by 50-100 CNY/tonne in China today. U.S. soybean performs strongly. Net crush margins for soybean futures have been negative as the cost of importing soybean stays high. Besides, downstream enterprises are afraid that logistics would be affected by the resurgence of COVID-19, so they have started stocking up ahead of the Lunar New Year. With an unexpected increase in demand, many oil plants have already sold January spot contract. Furthermore, drivers are required to submit valid certificates due to the anti-epidemic measures in many places. Under the shortages of vehicles, soybean meal supply gets tightened in the market. These have together buoyed soybean meal price. Additionally, cottonseed cost remains high, which boosts cottonseed meal price as well. But aquaculture has basically ceased, and hog capacity recovers slowly, seeing a subdued trade of cottonseed meal. Driven by the surge on US soybean prices, cottonseed meal market is projected to maintain a strong uptrend. Cottonseed meal move weakly on domestic exchanges, market participants had better keep a lookout of fluctuation in the short term.
(USD $1=CNY ¥6.46)