Today (Apr 15), the market for oilseeds and oils in China is shown as follows:
Oilseeds:
Imported soybean: Imported soybean 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 keep unchanged 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 rallied on Wednesday, supported by strong gains in U.S. soyoil futures and crude oil prices as well as concerns that a cold spell could hamper crop planting. Oils futures extend an uptrend on China’s Dalian Commodity Exchange today, and spot soybean oil and palm oil follow to go up 20-80 CNY/tonne, in thin trade.
Domestic soybean crush saw a further weekly decline of 12% to 1.36 mln tonnes last week, so soybean oil stocks also shrank by 4.8% to 590,000 tonnes. And port edible palm oil and rapeseed oil inventories also stay lows for this time in years. Moreover, crush margins for imported soybeans on Dalian board are at heavy loss. Hence, fundamentals are still bullish in domestic oils market. Meanwhile, U.S. soybean prices keep rallying and return to stand above the 1,400 cents mark, and this is lending support to cost side to domestic soybean oils. Besides, BMD palm oil futures are also bolstered to continue rising as recent exports improve month on month, which is also adding support to domestic oils. However, China will likely bring in 27 mln tonnes from April to June, as South American producers are actively marketing their new crops. Besides, China is starting auctions for soybean oil and rapeseed oil from reserves this week. And Southeast Asian producers will also see a seasonal rise in palm oil output, and a MPOB report shows that Malaysian March palm oil production and stocks are well above the forecast. The bullish sentiment in the market is thus curbed to some extent. The oils market may have limited upward impetus in the short run, and fluctuate frequently on the whole. Buyers are suggested to keep light stockpiles.
Soybean oil: GB Grade I soybean oil is offered at 9,230-9,360 CNY/tonne in domestic coastal areas, mostly up 10-80 CNY/tonne. (Tianjin trader 9230; Rizhao trader 9280; Zhangjiagang trader 9360; and Guangzhou trader 9280).
Palm oil: RBD palm olein is mainly priced at 7,770-7,970 CNY/tonne in coastal areas, mostly up 60-80 CNY/tonne. (Tianjin trader 7940-7970, up 60; Rizhao trader 7970; Zhangjiagang trader 7790, up 80; Guangzhou trader 7770, up 60; and Xiamen no offer).
Rapeseed oil: U.S. soybean futures closed sharply higher on Wednesday on support from strong gains in U.S. soyoil and crude oil prices, but rapeseed oil futures move lower after high opens on China’s Zhengzhou Commodity Exchange today. Spot rapeseed oil prices goes down 10 CNY to 10,860-11,100 CNY/tonne in coastal regions in thin trading.
China will likely bring in 27 mln tonnes from April to June, as South American producers are actively marketing their new crops. And Chinese government said that edible oils are in ample supplies, and the country is restarting soybean oil and rapeseed oil auctions. Besides, Southeast Asian producers will also see a seasonal rise in palm oil output. These are curbing domestic oils market. However, China’s rapeseed oil stocks fell 7.14% on week to 230,000 tonnes last week, and soybean oil and palm oil inventories also stay lows for this time in years. And crush margins for soybeans and rapeseed are at heavy loss on board. Hence, rapeseed oil prices only see small decline. Overall, short-term rapeseed oil market is predicted to fluctuate and adjust at the high level, and buyers can wait for the moment.
Cottonseed oil: Cottonseed oil prices keep steady with a partial fluctuation of 50-100 CNY/tonne in China today. U.S. soybean futures sharply rose on Wednesday on strong gains in soyoil and crude oil, coupled with concerns over crop planting under the frigid weather in U.S.. Oils futures extend the rally on Dalian Commodity Exchange today, driving soybean oil and palm oil prices 20-80 CNY/tonne higher in the spot market. Crush margins for imported soybean futures on Dalian exchange remain poor now, and bulk oils remain bullish on fundamentals. But cottonseed oil is offered higher but traded lower due to sluggish demand, in subdued trade. Moreover, with an upcoming seasonal increase in palm oil production, Malaysian palm oil production and stock in March are notably higher than anticipated, according to data from MPOB. This will limit the upward momentum for short-term oils market. It is predicted that cottonseed oil market may follow bulk oils to fluctuate in the short run.
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 will likely bring in 27 mln tonnes from April to June, as South American producers are actively marketing their new crops. Besides, China is starting auctions for soybean oil and rapeseed oil from reserves this week. Moreover, more downstream buyers choose corn oil as a substitute, which is also negative to sunflower oil market. But China’s edible palm oil and rapeseed oil inventories also stay lows for this time in years, and crush margins for imported soybeans on Dalian board are at heavy loss. Hence, these bullish fundamentals are also supporting 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 in China today. Grade I corn oil is 11,500-11,800 CNY/tonne. (Shandong 11,500-11,800 CNY; Hebei no offer; Liaoning 11,200; and Sichuan no offer); and crude corn oil is offered at 9,500-10,100 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. But corn germ prices are still at high levels, and sunflower oil, the rival of corn oil, also sees a decline in price under pressure. These may bring some bullish sentiment to the market. Overall, corn oil market in China is predicted to fluctuate to downside in the near term.
(USD $1=CNY ¥6.53)