Download App

[Caixin Futures: Most Agricultural Products Weak, Soybean Meal to be Sold on Rallies] ⑴ Edible Oils: Mainly volatile. Recent rainfall conditions are unlikely to support weather-related speculation, and the fundamentals of the edible oil spot market are weak. Themes from distant months cannot sustainably drive the near-month market. Overall rainfall in Indonesia is suitable for palm fruit growth, while the relatively dry conditions in the Malaysian Peninsula are beneficial for oil yield. Heavy rainfall in East Malaysia has hampered harvesting, and heavy rainfall in southern Thailand has slightly impacted rubber palm production. In the spot market, 24-degree palm oil in Guangdong rose by 30 yuan to 9420 yuan, soybean oil rose by 10 yuan to 8720 yuan, and rapeseed oil rose by 20 yuan to 10080 yuan. ⑵ Soybean Meal: Primarily sell on rallies or consider arbitrage opportunities. Internationally, related purchase commitments have boosted expectations for US soybean exports, and US soybean planting progress has reached 67%, higher than 63% in the same period last year. Favorable weather conditions have put some pressure on the rise of US soybean futures. Domestically, the pressure from imported soybean arrivals continues to ease, oil mill operating rates are recovering, and soybean meal inventories continue to accumulate. On the demand side, hog farming is suffering deep losses, and feed companies are mainly replenishing their inventories to meet immediate needs. The domestic supply-demand imbalance remains unchanged. The recommended strategy is to sell on rallies. (3) Corn: Sell on rallies. Recently, the main corn futures contract has been fluctuating at high levels. With the new wheat harvest approaching, some grain traders are clearing inventory, leading to increased shipments. However, downstream demand remains weak, resulting in sluggish market activity. Given the strong supply and weak demand, the fundamentals are bearish. Coupled with recent rumors of rice auctions, this has further pushed corn futures and spot prices down. (4) Hogs: Enter the reverse arbitrage market. The Ministry of Agriculture and Rural Affairs held a video conference on hog production capacity control, emphasizing the strict implementation of capacity reduction measures and stating that it will send working groups to promote their implementation. This led to short selling and a rise in the afternoon session. In the spot market, hog spot prices have been fluctuating recently. Supply pressure remains, demand is weak, and capacity reduction is slow. The initial supply of second-generation hogs was relatively large, and there may be further concentrated supply pressure later. It is recommended not to maintain naked short positions for now. The weak arbitrage situation continues, coupled with expectations of capacity reduction policies in the longer term, making it advisable to enter the reverse arbitrage market on rallies. (5) Eggs: A wait-and-see approach is recommended. Spot egg prices saw a slight pullback over the weekend. This was due to resistance from end-users to high prices after a continuous rise, and low restocking activity at all stages of the supply chain during the rainy season also put downward pressure on prices. Looking ahead, the number of laying hens in production may recover in June. Increased supply coupled with moderate demand could lead to a price correction. A wait-and-see approach is advised for now.