Oilseed Meals:
On Monday, CBOT soybean futures closed lower, pressured by robust U.S. crop prospects. Favorable overall crop weather and strong crop conditions in the U.S. weighed on the market. Post-market crop reports surprisingly showed U.S. soybean planting progress and crop ratings were below expectations. U.S. soybean export inspections for last week were reported at 490,000 tonnes, meeting expectations. Domestically, oilseed meal prices were volatile. Basis offers for U.S. and Brazilian soybeans were steady to higher, leading to only a slight decline in global soybean import costs. Soybean crush last week exceeded 2 million tonnes, soybean inventories rose, and a turning point in soymeal inventories was confirmed. There are no supply concerns for domestic soymeal, with higher import costs providing support. The trading strategy suggests limited long positioning.
Vegetable Oils:
On Monday, BMD palm oil was closed for trading and remained closed on Tuesday, with trading resuming Wednesday. Canola futures rose, influenced by renewed escalation in Middle East tensions. Official data showed that as of May 25th, planting progress was 38% in Saskatchewan, 60.9% in Alberta, and less than half in Manitoba, indicating a slow sowing pace. Domestically, vegetable oils traded stronger, with palm oil outperforming rapeseed oil, which in turn outperformed soybean oil. Despite ample spot supplies, the implementation of Malaysia's B15 mandate and Indonesia's initiation of palm oil controls have kept offers from producing regions firm, supporting palm oil prices. U.S. soybeans trading with firm undertones also lent support to domestic soybean oil. Rainfall in the Yangtze River basin is unfavorable for rapeseed yield prospects, warranting attention to domestic rapeseed production. The strategy favors long positions in palm oil and rapeseed oil.
Live Hogs:
On Monday, the July live hog futures contract saw a position reduction and price adjustment, with funds shifting to the September contract. Total open interest increased slightly, and hog prices continued their volatile performance. The current national average price for ternary crossbred hogs is 9.58 yuan/kg, up 0.01 yuan/kg from yesterday, with the lowest price in Guizhou at 8.9 yuan/kg and the highest in Guangdong at 10.31 yuan/kg (excluding Hainan). The national standard hog price is 9.58 yuan/kg, while fat hog price is 9.74 yuan/kg, resulting in a price difference of 0.16 yuan/kg. Sample data from key breeding enterprises shows today's national daily slaughter volume at 274,465 head, up 0.01% from the previous working day. The national average slaughter weight for ternary crossbred hogs is 122.93 kg, unchanged from the previous working day. The September hog futures contract faced pressure and adjusted lower, with breeding losses widening. Against this backdrop, in May, the Ministry of Agriculture and Rural Affairs issued the "Implementation Plan for Comprehensive Regulation of Hog Production Capacity (2026 Revision)". This plan, considering factors like pork market supply-demand balance and improvements in production efficiency, sets the national target for normal breeding sow inventory at around 37.5 million head, marking another reduction in the normal inventory target since February 2024. This indicates that national-level measures to reduce breeding capacity are being intensified. Market expectations for favorable data on fat hog slaughter are anticipated to materialize in July. Attention is on whether the distant September 2026 hog contract can stabilize and rise above the key 12,000 yuan/ton level.
Eggs:
On Monday, nearby contracts hit limit-up. The front-month July 2026 egg futures contract gapped higher at the open and continued to rise, experiencing only minor pullbacks during the session before rallying again to hit limit-up by the close. The July 2026 contract closed up 4.6% at 4391 yuan/500 kg. In the spot market, data shows the national average egg price yesterday was 5.16 yuan/jin, up 0.16 yuan/jin. In production areas, Ningjin pink-shell eggs were at 5.05 yuan/jin, up 0.2 yuan/jin, while Heishan brown-shell eggs were at 4.9 yuan/jin, up 0.1 yuan/jin. In consumption areas, Puxi brown-shell eggs were at 5.05 yuan/jin, up 0.1 yuan/jin, and Guangzhou brown-shell eggs were at 5.35 yuan/jin, up 0.2 yuan/jin. As spot prices continued to rise, most traders followed the trend, with prices in major consumption markets mostly higher. In the short term, tight supply combined with pre-Dragon Boat Festival restocking has driven spot prices higher, reaching the highest levels for this period in history. Additionally, market sentiment continues to support egg prices, maintaining a strong pattern in both futures and spot markets. Later, as southern regions gradually enter the rainy season, egg spot prices may be affected by cautious trader restocking, increasing the probability of a seasonal correction. The short-term view suggests high volatility, with caution warranted against the risk of a pullback from elevated levels. Monitor changes in breeding farm restocking and slaughter intentions following increased profitability and their impact on supply.
Corn:
On Monday, the July corn futures contract rose on reduced positions, while the September contract saw limited position building. Total open interest declined, with prices showing a short-term rebound. In the spot market, the release of old rice stocks and the new wheat harvest are creating consumption alternatives to corn, reducing feed mills' purchasing enthusiasm. Today, corn prices in Northeast China were steady to slightly weaker. Ongoing price cuts by local processors for new crop purchases are having a negative impact, with no improvement in corn shipments from the Northeast production region. Currently, with new-season wheat hitting the market, feed mills are increasing wheat procurement, leading to relatively subdued short-term corn demand. Corn is expected to show no immediate signs of improvement and may maintain a steady-to-weak trend. In North China, corn prices were generally weak and volatile, with slight declines in some areas. Farmer-held stocks are nearly depleted, with grain concentrated in traders' hands. However, due to high inventory costs, traders have strong price support intentions and are relatively cautious in their sales pace. Downstream processors have ample inventories and are purchasing based on immediate needs. Feed mills, affected by alternatives like wheat and sprouted wheat, have weak corn demand and low purchasing enthusiasm. Monitor the progress of the wheat harvest. In consumption area markets, corn prices were mostly stable overall, with light trading activity. Downside is limited by production area cost support. Downstream feed mills have strong expectations for substitution by new wheat, leading to continued diversion of corn demand, low purchasing enthusiasm, and a strategy of buying as needed. Technically, the July corn contract is trending higher within a volatile range. For the front-month contract, watch resistance near the 10-day moving average. The medium-term outlook remains for volatile-to-weak performance.
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