Price trend

According to data from SunSirs Market Analysis System, starting from April, supported by multiple favorable factors, the soybean meal market continued to rise, with prices hitting new highs until May. After May Day, the average market price of soybean meal rose to 4,400 RMB/ton, an increase of 14.98% compared to 3,844 RMB/ton at the beginning of the month.

The main reasons for the rise of soybean meal market in this round are as follows:

Supply side: From April 1st to 15th, the actual shipment of Chinese soybean imports was 695,600 tons, a year-on-year increase of 75.30%; The import forecast for this month was 824,000 tons, a year-on-year decrease of 91.03%; The import forecast for next month was 211,500 tons, a year-on-year decrease of 97.30%.

Although the shipment volume of imported soybeans increased, due to customs policies, the clearance of imported soybeans was slow, and the operating rate of soybean oil factories decreased. Some soybean oil factories were shutting down, resulting in a tight supply of soybean meal and a sharp rise in the market.

Inventory: According to the soybean meal inventory chart from November 2022 to May 2023, it can be seen that the soybean meal inventory in the first quarter was at a high level, with a maximum inventory of nearly 600,000 tons. Entering April, soybean meal inventory began to rapidly decline, and inventory levels continued to decline. After May Day, the inventory of soybean meal has dropped to the line of 200,000 tons, which had decreased by more than 100% compared to the first quarter. The low inventory of soybean meal hd boosted the soybean meal market to continue to rise.

Demand side: Since April, the demand in the terminal feed industry has rebounded, and aquatic feed has gradually entered the peak consumption season. The demand for soybean meal procurement by feed factories has gradually recovered, and the market sales volume has increased, resulting in improved transactions.

USDA report: The global soybean production forecast for April 2022/23 has been lowered to 369.64 million tons, Argentina's soybean production forecast for 2022/23 has been lowered to 27 million tons, and China's soybean crushing forecast for 2022/23 has been lowered to 91 million tons.

Futures: The April USDA report was mainly bullish, supporting the soybean meal futures market. The Dalian soybean meal futures market oscillated and rose, while the spot market followed suit. After the May Day holiday, the futures market of Dalian soybean meal continued to rise. On May 8th, Dalian soybean meal ended 3,544 RMB/ton, an increase of 57 RMB/ton, and the average spot price of soybean meal was 4,420 RMB/ton, an increase of 2.22% compared to the beginning of May.

Market outlook

Agricultural product analysts from SunSirs believe that the soybean meal market surged in April, mainly due to the tight supply of imported soybeans on the supply side and a significant decline in the start-up of soybean oil factories. In May, the customs clearance of imported soybeans improved, the tight supply situation of soybean meal eased, and the market gradually digested the bullish situation. Soybean meal market may face upward pressure in the future, mainly with a downward trend.

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