Protein Meal: On Monday, CBOT soybeans rose, tracking gains in crude oil prices. The continued closure of the Strait of Hormuz heightened concerns over energy supply tightness, triggering a surge in oil prices, which lifted U.S. soybean products. The export inspection report largely met expectations. The post-market crop progress report indicated U.S. soybean planting was 49% complete, exceeding forecasts. Brazil's May soybean exports are projected to reach 14.53 million tons, up from 14.18 million tons in the same period last year. In the domestic market, both soybean meal and rapeseed meal halted their declines. Significant pressure from high soybean arrivals in May and severe losses in the livestock sector weighed on soybean meal futures and spot prices. However, rising import costs provided support. Trading strategy: Consider short-term long positions.
Oils and Fats: On Monday, BMD palm oil ended a three-day losing streak and moved higher. April inventories exceeded expectations, making the MPOB report bearish. However, the closure of the Strait of Hormuz and rising energy prices boosted overall vegetable oil prices. Domestically, oils and fats traded on a weaker note. Spot market performance was muted, with end-users maintaining rigid demand and purchasing cautiously. Soybean oil and palm oil inventories were being drawn down slowly, while rapeseed oil stocks climbed. Overall oil and fat inventories declined, indicating a generally ample supply. Strategy: Engage in short-term trades.
Live Hogs: On Monday, the main live hog futures contract (2607) stabilized near the support of the 20-day moving average, closing slightly higher with a small positive candlestick, showing an oscillating upward trend during the session. In the spot market, hog prices in Northeast China were mostly steady with minor adjustments. The mainstream transaction price in Heilongjiang was 9.14 yuan/kg, down 0.09 yuan/kg from the previous day; in Jilin, it was 9.37 yuan/kg, down 0.04 yuan/kg; in Liaoning, the mainstream slaughter price was 9.64 yuan/kg, down 0.05 yuan/kg; and in Inner Mongolia, the mainstream transaction price was 9.54 yuan/kg, down 0.09 yuan/kg. Technically, after two consecutive days of decline for the July contract following the Labor Day holiday, focus shifts to the effective support from long-term moving average indicators. Maintain a short-term long trading view for now.
Eggs: On Monday, the main egg futures contract (2606) continued to strengthen, tracking spot prices, closing up 4.48% at 3,616 yuan per 500 kilograms. Far-month contracts also rose but with smaller gains than the near-month contract. In the spot market, data showed the national average egg price was 4.37 yuan/jin, up 0.09 yuan/jin from the previous day. In producing areas: Ningjin pink-shell eggs were at 4.3 yuan/jin, up 0.1 yuan/jin; Heishan brown-shell eggs were at 4.2 yuan/jin, up 0.15 yuan/jin. In consumption areas: Puxi brown-shell eggs were at 4.55 yuan/jin, up 0.11 yuan/jin; Guangzhou brown-shell eggs were at 4.65 yuan/jin, up 0.15 yuan/jin. Terminal demand was relatively good, with most traders actively buying and selling, leading to overall price increases in consumption area markets. Arrivals in consumption areas increased compared to the previous day. However, as spot prices continued to rebound, downstream purchasing enthusiasm waned. Based on historical chick placement data, the number of new laying hens entering production continues to increase until August. On the other hand, rising farming profits have reduced culling willingness, which is not conducive to reducing production capacity. As the plum rain season approaches later, demand is expected to negatively impact egg prices again. The near-month contract continues to strengthen influenced by spot prices, while far-month contracts are slightly weaker. Await opportunities to sell on rallies, while remaining alert to potential disruptions from increased culling or strength in related commodity prices.
Corn: On Monday, corn futures prices moved lower in a choppy session. The main contract (2607) saw a minor rebound before resuming its downward oscillation. The July contract fell to test support at the 2,350 yuan psychological level, continuing its weak performance. Over the weekend, corn purchase prices at Northeast deep-processing enterprises were slightly lowered. Influenced by increased policy grain auctions, spot corn prices in Northeast China showed some weakness. However, inventory costs for grain sources in the Northeast production region remain relatively high, and traders' willingness to sell at low prices is generally limited, suggesting the potential downside for prices may be relatively constrained. In North China, corn prices trended weaker over the weekend. As the wheat harvest approaches, traders intensified efforts to clear inventories, leading to high arrivals at deep-processing plants. Enterprises continued to lower purchase prices, and short-term prices are expected to remain soft. In consumption areas, corn prices showed limited movement over the weekend, with cautious market sentiment. Recovery in the livestock sector remains gradual. Feed mills maintain reasonable raw material inventory levels, mostly adopting a hand-to-mouth purchasing strategy. Ample supplies of feed alternatives continue to divert demand away from corn, leaving the overall market lacking a clear driving force. In summary, supply conditions in the corn market appear somewhat relaxed, while demand remains relatively subdued, suggesting corn prices will likely remain steady to weak in the short term. Technically, monitor the support performance at the 2,350 yuan level for the July contract. Also, keep an eye on the release of over-storage rice and the progress of the new wheat harvest.
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