Recently, fluctuations in domestic oil prices, egg and soybean meal prices have attracted widespread attention. The latest round of oil price adjustments took place on April 28, along with new changes in the egg and soybean meal markets.
Approaching the May Day holiday, egg prices seem to have fallen into a state of stagnation. According to market observations, domestic egg prices have been hovering at a low level. The price of ordinary brown shell eggs in the village market is between 3.4 and 3.6 yuan/catty, while the price of eggs in the production area stays at about 3.3 yuan/catty, and the market in the sales area is slightly lower, about 3.28 yuan/catty. Overall, the market demand for eggs is weak and sales are cold.
There are two main reasons for the downturn in the egg market. First of all, with the decline in the price of pork, beef and mutton and other meats, the demand for eggs by residents has decreased. At the same time, as the weather gradually warms, it is more difficult to store eggs, and consumers no longer hoard eggs in large quantities. Secondly, the inventory of laying hens is increasing, but the downstream market demand is sluggish, and the inventory pressure is increasing.
The domestic soybean meal market is also showing a trend of low shocks. In coastal areas, the price of 43% protein soybean meal is between 3,260 and 3,340 yuan/ton. Although the soybean meal quotation of oil mills has some support, the overall market supply is still large.
The soybean meal market is supported from several sources. First of all, the cost of importing soybeans is relatively high, especially since Brazilian premium quotations remain at a high level. Secondly, the arrival of imported soybeans in April was small, the operating rate of oil mills did not increase significantly, and the inventory of soybean meal was relatively low. However, with the arrival of May and June, the volume of imported soybeans will increase significantly, with imports expected to exceed 11 million tonnes in May and more than 10 million tonnes in June. As supply increases, mill operating rates are likely to pick up and the soybean meal market could come under pressure.
In terms of the refined oil market, oil prices in April were adjusted three times, and the first two oil prices rose continuously, with gasoline rising by 400 yuan/ton and diesel rising by 385 yuan/ton. However, there was a "dive" in the third adjustment, and oil prices finally ushered in a decline. On April 26, Brent crude oil prices rose to $89.5 per barrel, while U.S. oil rose to $83.85 per barrel, and oil prices remained high and volatile. Still, this is in a downward phase compared to the previous high.
The reason for the decline in oil prices is related to the fluctuation of international crude oil prices. The current round of oil price adjustment cycle is nearing the end, the crude oil change rate is -1.88%, and the price of gasoline and diesel is expected to drop by 85 yuan/ton, equivalent to 0.06 to 0.08 yuan per liter of No. 92 and No. 95 gasoline.
Overall, the "dive" in oil prices is good news for consumers, while the egg and soybean meal markets are facing different market pressures. The egg market is oversupplied leading to weaker prices, while the soybean meal market is likely to face supply pressures as imports of soybeans increase. Changes in the market require constant attention to understand future trends.
Amid changes in the oil price, egg price and soybean meal market, consumers and industry practitioners alike need to keep an eye on what the future holds in order to make informed decisions.
Egg prices have remained low in the near term, but volatility is also possible. As the May Day holiday approaches, consumer demand may pick up briefly, but egg prices may fall further as the holiday season ends. Consumer demand for eggs is gradually decreasing, especially as the temperature rises and makes storage difficult, which increases the inventory pressure on the egg market.
At the same time, egg production is at a high level, the number of laying hens is increasing, and the number of old chickens culled is small, which means that the supply of eggs is abundant. However, the purchase and sales activity in the downstream market is not high, and the mentality of merchants and supermarkets is not strong, resulting in a weak market as a whole. Even so, as egg prices fall, there may be a wave of bottom-buying in the market, but this recovery may not last.
The soybean meal market is in a period of volatility. Although the domestic spot price of soybean meal is at a low level, the overall market supply may increase. With the increase in imported soybean arrivals in May and June, oil mill operating rates are expected to increase, which may increase soybean meal inventories, putting more pressure on the soybean meal market.
However, soybean meal quotations from oil mills are still supported to some extent. The soybean meal market was supported by high premium quotations for Brazilian soybeans and the high cost of imported soybeans. At the same time, the U.S. beans have entered a new planting period, and factors such as weather may affect the U.S. bean market, which in turn will have some support for the domestic market. While oil mills are facing the pressure of accumulation, they may adjust their production strategies due to changes in the cost of imported soybeans, which will have a direct impact on the trend of the soybean meal market.
The drop in oil prices is good news for consumers. Although the oil price adjustment is not large, the decline in gasoline and diesel prices can alleviate the pressure on consumers' fuel spending to a certain extent. Affected by international oil prices, domestic oil prices fluctuate to a certain extent, but the overall trend is still declining. Against this backdrop, consumers can expect oil prices to remain low in the future.
The drop in oil prices, while limited, is still a positive sign for transportation, logistics and other fuel-dependent industries. Companies can adjust their operational strategies according to changes in oil prices to reduce costs and increase profits.
In summary, the decline in oil prices is good news for consumers and industry practitioners, but changes in the egg and soybean meal markets require more attention. The downturn in the egg market is likely to continue for some time, while the soybean meal market is under pressure to accumulate inventory. The market is volatile, and relevant practitioners and consumers need to adjust their strategies in a timely manner to adapt to new market trends.