According to the Commodity Market Analysis System of SunSirs, since June, the soybean meal market has continued to oscillate and rise, with prices hitting new highs. It has been rising until mid July, with an increase of nearly 15%. On June 1st, the average market price of soybean meal was 3,770 RMB/ton. On July 20th, the average market price of soybean meal was 4,342 RMB/ton, with a price increase of 15.17%.

The oscillation and rise of soybean meal market in this round are mainly influenced by the following factors:

Supply side: According to imported soybean data from January 2022 to 2023, the overall quantity of imported soybeans in China in the first half of 2023 far exceeded the same period last year. The quantity of imported soybeans increased significantly in May and June. China imported 10.27 million tons of soybeans in June, with a cumulative import of 52.575 million tons from January to June, a year-on-year increase of 13.6%. The continuous increase in imported soybeans has eased the tight supply of soybean meal and put pressure on the market.

Inventory: According to domestic soybean meal inventory statistics from January to July, soybean meal inventory began to decline continuously in March and had already dropped to the annual low of 200,000 tons in early May. In mid May, soybean meal inventory continued to increase, reaching an annual peak of 710,000 tons until the end of June. Since July, soybean meal inventory has gradually decreased, and as of the week ending July 14th, soybean meal inventory has dropped to around 520,000 tons. The pressure on soybean meal inventory has eased, and the market continues to rise.

Futures: The external market of American beans is in the growth period, and due to the influence of El Nino weather, the excellent rate of American beans is at a relatively low level. The external market of soybean futures is constantly rising, and the domestic soybean meal market is supported, and the market continues to oscillate and rise. The spot market continued to oscillate and rise with the market. On July 20th, the settlement price of the main contract for soybean meal was 4,193 RMB/ton, an increase of over 8% compared to early June.

Demand side: After June, the weather turned hot and entered July with continuous high temperatures. Due to the impact of high temperatures, the consumption level of feed terminal meat decreased. Market entities were cautious in purchasing feed and used it as needed. The transaction of soybean meal was average, but demand slowed down and remained sluggish, which had certain restrictions on the rise of soybean meal market.

SunSirs agricultural product analyst believes that the soybean meal market in this round is mainly driven by the external futures market, and there are still bearish supply and demand sides. It is expected that the soybean meal market will rise under pressure in the future, with weak prospects mainly coming down.

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