Soymeal

Soymeal on the European meals and feeds market was offered mixed in thin trade on positioning ahead of Thursday’s USDA crop and supply/demand reports. South American soymeal was offered between $3 a tonne higher and $3 lower. Pressure came from ongoing concerns about the trade dispute between the United States and the world’s largest soy buyer China, which also weighs on CBOT soymeal futures.

Soymeal spot basis offers were largely unchanged at US domestic and export markets as demand remained robust and soy crush margins hovered near the highest levels ever. The recent decline in Chicago Board of Trade soymeal futures enticed domestic livestock and poultry producers to buy train and truckloads of the animal feed. CBOT August soymeal touched a low of $328.20 per ton, the lowest since the roughly five-month low on June 19. Comparatively larger declines in prices for soybeans boosted profit margins for soybean processors. Crush margins on the CBOT of nearly $1.93 per bushel per bushel of soybeans. That is the highest nice record-large crush margins in 2014, suggesting processors could turn big profits. One cash dealer pegged profit margins on each ton of soymeal at about $50.

A total 137.4 KMT of soybean meal was shipped abroad in September-January 2017/18 that is up 28.5% on the year. January exports were higher than last year – 32.8 KMT compared to 22.3 KMT. In September-January 2017/18, the bulk of Ukrainian soybean meal exports went to Belarus and the European Union: 33% and 31%, respectively.

A total 137.4 KMT of soybean meal was shipped abroad in September-January 2017/18 that is up 28.5% on the year. January exports were higher than last year – 32.8 KMT compared to 22.3 KMT. In September-January 2017/18, the bulk of Ukrainian soybean meal exports went to Belarus and the European Union: 33% and 31%, respectively.

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. Soybean arrivals in April are expected to increase to cope with the higher demand in meal. 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.