SunSirs: China's Soybean Meal Ushered in a Rebound in July

According to SunSirs data monitoring,in the second quarter of 2020, soybean meal has fallen for three consecutive months, and the price has plummeted by over 16%. In the third quarter, soybean meal began to turn things around. Although the price of soybean meal has been adjusted towards the end of the month, it is still difficult to conceal the rising trend of soybean meal. Since July, the price of soybean meal has bottomed out and has risen mainly due to fluctuations. As of July 28, the average market price of soybean meal was RMB 3,072/ton, an increase of 7.62% from the price in early July.

Bullish factors support soybean meal oscillating rise in July

At the end of June, the USDA planting report lowered the U.S. soybean planting area and quarterly inventory forecasts. The reported data is bullish. In addition to the previous soybean meal has been falling, market participants are more bullish about soybean meal. Starting from July, even soybean meal has risen as expected, and the spot market has risen sharply. . Because the quantity of imported soybeans to Hong Kong has increased sharply, the supply pressure of soybean meal is still under pressure, coupled with the good growth rate of US soybeans, which limits the increase of soybean meal to a certain extent. Due to the recovery of terminal pig production capacity and aquaculture feed demand has increased, soybean meal prices have continued to rise. At the end of July, due to the escalation of Sino-US relations and increasing uncertainties, soybean meal prices staged a sharp rise and fall.

Pig stocks recover, soybean meal is full of momentum

Since June, the price of live pigs has shown an upward trend, and the increase in pig prices has stimulated farmers' confidence in replenishing stocks, and the production capacity of live pigs has been gradually restored. According to data from the National Bureau of Statistics, the number of live pigs at the end of the second quarter was 339.96 million, an increase of 5.8% over the end of the first quarter. At the end of June, the national population of reproductive sows was 36.29 million, which turned from negative to positive for the first time year-on-year, an increase of 5.49 million from the end of last year. The live pig inventory was close to the level of the same period last year, reaching 340 million heads, an increase of 29.29 million heads from the end of last year. The stock of live pigs has recovered, the rigid demand for feed has increased, and soybean meal manufacturers are expected to increase in bullish expectations, and the price of soybean meal is still rising.

Substitute corn price is strong, soybean meal market is supported

In July, the State Reserve corn auctions were hot, and the volume and prices continued to rise. The average corn transaction price exceeded the 2,000 yuan/ton mark and reached 2,017 yuan/ton. The policy transaction price continued to increase, driving the domestic corn market price to rebound, and the domestic corn market price A sharp increase of nearly 20% from the beginning of the year, driven by the sharp increase in corn prices, soybean meal prices have also shown an upward trend.

SunSirs agricultural product analysts believe that uncertain factors on the soybean meal market news once again increase, and there is the possibility of sharp rise and fall at any time. Therefore, soybean meal prices still have room to rise in August. Since soybean meal pressure is still on the fundamentals, the market outlook will continue to fluctuate upward.

If you have any questions, please feel free to contact SunSirs with support@sunsirs.com.