Chinese soymeal demand to rise in April: CNGOIC

Chinese soymeal demand will increase in April as consumption from seasonal fish farming is expected to outweigh a typical post Chinese New Year slump in demand from the livestock sector, the China National Grain & Oil Information Centre said in a weekly report Thursday.

Soybean arrivals in April are expected to increase to cope with the higher demand in meal, the CNGOIC said, and reported that March arrivals are expected to come in at 6.3 million mt, equal to March 2017.

However, for now, crushers are not incentivised to increase their run rates, as domestic meal prices dropped from their pre-CNY highs by RMB60-100 /mt ($9.5 - $16/mt) to 3000-3100 RMB/mt ($475 - $491/mt).

Meanwhile, soymeal stocks remain buoyant and currently stand at 720,000 mt, up 40,000 mt on the week.

China crushed 1.8 million mt of soybeans last week, unchanged for the same week last year, but remains below levels seen before Chinese New Year, which topped the 2 million mt level.

Demand for soy oil remains strong as it is $20/mt cheaper than rapeseed on a CIF basis, at $453/mt while also remaining more competitive than palm oil.

About 300,000 mt of soybean oil is expected to arrive in March 2018, up 100,000 mt from the month before.