First Capital Futures: Short covering before the holiday, internal market's two soybean meal prices widen the increase

Today, domestic soybean meal and rapeseed meal continued their rebound and strength, with long positions reducing and prices rising. In particular, the nearby contract saw significant short covering, with the nearby rapeseed meal settlement price rising over 2%. Overnight, international soybean and rapeseed costs continued to strengthen, ignoring the USDA monthly report’s bearish outlook. U.S. soybeans for March gained 13.5 cents, offsetting the Brazil CNF premium/discount correction of 5 cents, while the main May rapeseed contract continued to rise moderately by 2.3 Canadian dollars per ton. Currently, the negative impact of squeezed crushing margins for rapeseed has largely been realized, and the rising rapeseed costs provide support for domestic rapeseed products. Overall, despite weak spot fundamentals, the continued increase in oilseed import costs before the Spring Festival holiday has driven domestic soybean meal and rapeseed meal short covering, causing prices to rebound from lows. In terms of trading strategy, it is recommended to mainly exit positions and observe, while being cautious of the risks associated with the long Spring Festival holiday. (First Capital Futures)