SunSirs: Basic Situation of China's Soybean Oil and Palm Oil in August

According to data monitoring by SunSirs: Soybean oil palm oil continued to ride the wind and waves in August, and the price continued to rise and fall, and the overall price continued to rise. In the long-short game, soybean oil and palm oil both staged multiple rounds of sharp rises and then ushered in a sharp decline. Near the end of the month, soy oil and palm oil finally staged a wave of sprints, returning the market that was still declining to a rising channel.

At the beginning of the month, the average soybean oil market price was 6,416 yuan/ton, and at the end of the month, the average soybean oil market price was 6,693 yuan/ton, and the price rose 4.31%. At the beginning of the month, the average market price of palm oil was RMB 5,934/ton, and at the end of the month, the average price of palm oil market was RMB 6,112/ton, with a price increase of 3%.

According to the monthly rise and fall of soybean oil in July 2019-2020, it can be seen that in 2019, soybean oil rose more and fell less, and the overall increase was the main one. The increase in August was the highest, with an increase of more than 13%. Soybean oil rose sharply in October and December in the fourth quarter.

In the first half of 2020, soybean oil was relatively weak as a whole. It has been falling from January to April, with the largest decline of more than 16% in February. The soybean oil market rebounded from May to July, with the largest increase of more than 12% in July. Soybean oil also rose in August, rising by more than 4%.

According to the monthly rise and fall of palm oil in July 2019-2020, it can be seen that palm oil was generally strong in 2019, rising for 7 months, with the highest increase of more than 17%. Palm oil rose sharply in the fourth quarter for three consecutive months, with the highest increase in December.

In the first half of 2020, it has been falling from January to April, and the decline is more obvious than that of soybean oil. The largest decline is more than 20%. From May to July, the price of palm oil returned to the rising channel. In July, the price rose by more than 12%. Palm oil continued to rise as a whole in August, with an increase of more than 3%.

Long-short game, August soybean oil palm oil rises and falls

In early August, under the negative pressure of USDA report for soybean oil and palm oil, the futures market rose weakly and the boost was limited. The terminal demand was relatively weak, the spot market gradually weakened, and the price gradually ushered in a callback phase. The overall decline of soybean oil palm oil was close to 3 Points.

On the 13th, market news of soybean oil purchasing and storage rumors resumed. It is expected that the country will buy and store 2 million tons of soybean oil, which will bring an exciting blow to the sluggish oil market. Buying orders enter the market. Oil followed up with an increase of nearly 4 points. After the mid-month rise, soybean oil and palm oil ushered in a callback again.

At the end of the month, the stocking market started before the Mid-Autumn Festival and the National Day. Moon cake factories increased their purchases, supported by rigid terminal demand, and soybean oil palm oil began to exert force. The futures prices ushered in rising prices, which changed the trend throughout August.

High inventories, soy oil gains are limited

This year, the number of imported soybeans in my country has repeatedly set new highs. In April, the imported soybeans reached 6.77 million tons, and in May it was as high as 9.377 million tons. By June, the number of imported soybeans reached 11.16 million tons. In July, my country's soybean imports reached more than 10 million tons. 10.91 million tons. From January to July in 2020, my country imported 55.13 million tons of soybeans, an increase of 17.7% year-on-year. The quantity of imported soybeans arriving in Hong Kong increased sharply in August, and the operating rate of soybean oil plants rebounded. Soybean oil stocks lasted around 1.2 million tons throughout August. As of the week of August 21, soybean oil stocks have returned to the line of 1.25 million tons, which is still preventing the soybean oil market from rising sharply.

Data is mainly negative, palm oil rises under pressure

Palm oil data in August is still mainly bearish. Malay palm oil production increased month-on-month, exports decreased, and consumer demand declined. The MPOA report shows that Malay output increased by 0.94% month-on-month from August 1-20, and palm oil exports from August 1-25 were 1219718 tons, a month-on-month decrease of 16.17%. Oil World said on the 26th that in 2019/20 (October to September of the following year), global palm oil consumption is expected to significantly decrease by 2 million tons, and consumption will decline for the first time. The poor performance of the external disk data was negatively suppressed, and the domestic palm oil rose under heavy pressure.

Li Bing, an agricultural product analyst at SunSirs, believes that the Mid-Autumn Festival and National Day stocking market can basically guarantee that soybean oil palm oil will not see a sharp decline in the short term. From the perspective of fundamental data, there is still room for decline in soybean oil palm oil, and the market outlook is still limited.

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