First Capital Futures: External strength and internal weakness, domestic soybean meal futures slightly stronger

Overnight, U.S. soybeans surged by 2.37% due to a phone call between the U.S. and Chinese leaders, and Trump claimed that China might increase its old-crop soybean purchases to 20 million tons. China has already fulfilled its previous commitment of 12 million tons of U.S. soybeans, and if it continues to buy 8 million tons, it could push U.S. old-crop soybean inventories back below 300 million bushels. However, the large increase in U.S. soybean prices has limited impact on domestic soybean meal and soymeal prices, as the CNF premium/discount for Brazilian nearby shipments has fallen by 20 cents, offsetting most of the U.S. soybean rally. If China continues policy-driven soybean purchases, it will squeeze Brazilian soybean export demand. Therefore, the overall cost-driven pressure on domestic soybean meal remains limited, with the nearby market remaining relatively strong. Currently, domestic soybean meal procurement before the holiday is nearly complete, and soybean and soybean meal supplies remain generally ample. The market widely expects spot prices to decline after the holiday, indicating a potential weakening trend. Overall, soybean meal prices are still oscillating at low levels, with post-holiday pricing reverting to Brazilian cost basis. In the context of no significant supply-demand conflicts in the near term and ample supply, the impact of U.S. soybean market sentiment on the domestic market is expected to be limited. It is recommended to maintain a range-bound trading strategy. (First Capital Futures)