Report Summary 1. Report Industry Investment Rating - No information provided on the report industry investment rating. 2. Core Viewpoints - The meeting between China and the US today fell short of expectations, and the price of US soybeans declined. The profitability of domestic soybean purchases has improved but remains poor. The domestic futures market has a low multiple, and the short - term expectation is for a rebound to repair the crushing profit. However, the current abundant supply of near - term soybean meal spot and the expected abundant global soybean supply in the long - term limit the upside potential of the futures market. Attention should be paid to the subsequent evolution of drivers brought about by China - US policies and South American weather changes [8]. 3. Summary by Related Catalogs 3.1 Basis and Spread Data - On October 30, the basis of the main contract of soybean meal in Zhangjiagang was - 24, with a decrease of - 25. The basis of 43% soybean meal spot in different regions showed various declines, such as - 25 in Tianjin and Rizhao [6]. - The basis of rapeseed meal spot in Guangdong was 73, with an increase of 13. The RM1 - 5 spread was 1500, with a change of 23 [6][7]. - The spot price difference between soybean meal and rapeseed meal in Guangdong was 593, with a decrease of - 3; the price difference between the main contracts was 448, with a decrease of - 16 [7]. 3.2 Ascending and Descending Premiums and Profit Data - The US dollar to RMB exchange rate and the ascending and descending premiums of Brazilian soybeans in 2025 were presented, along with the change in the spot crushing profit of imported soybeans. For example, the spot crushing profit of Brazilian soybeans was - 261.00 yuan/ton, with a change of 5 [7]. 3.3 Supply Situation - The USDA estimates the ending inventory of US soybeans in the 25/26 season to be 300 million bushels, and the expected yield per acre of 53.5 bushels may be adjusted downward. Exports depend on China - US policies. As of October 25, according to CONAB data, the sowing rate of Brazilian soybeans was 34.4%, compared with 21.1% last week, 37.7% in the same period last year, and a five - year average of 42.5%. It is expected that domestic soybean meal will start to reduce inventory in November, but the supply in the fourth quarter is still expected to be abundant. If China cannot purchase US soybeans, the supply of soybean meal in the first quarter of next year still needs to be supplemented, and the source of supplementation is uncertain [7]. 3.4 Demand Situation - In the short - term, livestock and poultry are expected to maintain a high inventory, and the reduction of production capacity is not obvious, which supports current demand. However, the current hog farming is showing losses, and national policies tend to control the inventory and weight of hogs, which may affect the supply in the far - term. The downstream transactions of soybean meal are normal, and the pick - up is good [8]. 3.5 Inventory Situation - Domestic soybean and soybean meal inventories are at historically high levels in the same period, and the number of days of soybean meal inventory in feed enterprises has decreased to a low level [8].

1. Report Industry Investment Rating - The report does not explicitly mention an overall industry investment rating. However, the investment view for both soybean meal and rapeseed meal is "oscillating" [3]. 2. Core Viewpoints of the Report - The supply - demand situation of soybean meal and rapeseed meal is complex, influenced by multiple factors such as US soybean production, domestic inventory, import policies, and feed demand. The market is expected to be in an oscillating state, and the key to future trends lies in Sino - US policies [3]. 3. Summary According to Relevant Catalogs 3.1 Main Viewpoints and Strategy Overview - **Supply**: The USDA August report adjusted the US soybean yield and planting area, resulting in a tight supply - demand balance sheet for new - crop US soybeans in 2025/26. The domestic soybean arrival volume in September is expected to exceed 10 million tons, and soybean meal is in a stockpiling cycle. The supply - demand gap for soybean meal in the first quarter of next year depends on Sino - US policies. The supply of imported rapeseed meal and rapeseed in China is expected to decrease under Sino - Canadian trade policies, while the opening of Australian rapeseed imports is expected to supplement the domestic rapeseed meal supply in the fourth quarter [3]. - **Demand**: Short - term high inventories of pigs and poultry support feed demand, but policy guidance to control pig inventory and weight may affect future pig supply. Soybean meal has high cost - effectiveness and high pick - up volume, and the peak season of aquaculture supports rapeseed meal demand. However, wheat substitution for corn in some areas reduces protein consumption, and downstream transactions of soybean and rapeseed meal are cautious this week [3]. - **Inventory**: Domestic soybean inventory has reached a high level, soybean meal inventory is rising (lower than the same period last year but still in a stockpiling cycle), and the inventory days of feed enterprises' soybean meal are increasing. Domestic rapeseed inventory has declined to a low level, and rapeseed meal inventory is being depleted but remains at a high level compared to the same period in previous years [3]. - **Basis/Spread**: The basis is weak [3]. - **Profit**: Brazilian soybean crushing profit has deteriorated, while Canadian rapeseed crushing profit is good [3]. - **Valuation**: The prices of soybean and rapeseed meal on the futures market are currently at a neutral valuation position [3]. - **Macro and Policy**: Attention should be paid to the results of Sino - US negotiations on soybeans. China has started to release imported soybeans from reserves, and is expected to open up Australian rapeseed imports and actively apply for relevant GMOs [3]. - **Investment View**: For soybean meal, the M01 contract was weak this week due to Sino - US peace - talk expectations and reserve releases, but the tight supply - demand situation of US soybeans supports the CBOT US soybean futures market. The spread between US soybeans and Brazilian soybeans' CNF premiums has narrowed to a normal range, and it is expected that the decline of Brazilian soybeans' CNF premiums will be limited. With the support of import costs, the downside space of M01 is expected to be limited, and it is expected to move in an oscillating manner in the short term. The basis and spread trends depend on Sino - US policies. For rapeseed meal, with the absence of Canadian supply, domestic inventory is expected to decrease, but the opening of Australian rapeseed imports is expected to supplement the supply. The RM01 contract is a off - season contract, and it is expected that the supply - demand contradiction will not be significant, and it will generally follow the oscillation of soybean meal, with attention paid to policy changes [3]. - **Trading Strategy**: Unilateral trading is expected to be oscillating, and arbitrage is advised to wait and see. Risks to watch include policies and weather [3]. 3.2 Fundamental Supply - Demand Data of Meal Products - **Soybean and Rapeseed Inventory - to - Consumption Ratios**: In August 2025, the inventory - to - consumption ratios of US soybeans and global soybeans in the 2025/26 season decreased. The report also shows the inventory - to - consumption ratios of Brazilian and Argentine soybeans, as well as global and Canadian rapeseed over the years [35][36][45]. - **US Soybean Production and Sales**: The sowing rate and excellent - good rate of US soybeans are presented. The domestic crushing profit of US soybeans is rising, the NOPA soybean crushing volume and USDA US soybean monthly crushing volume data are provided, and this week's US soybean exports declined [47][51][63]. - **Import and Cost**: The CNF premium of soybeans, the import cost of Canadian rapeseed, and the exchange rate of the US dollar against the Brazilian real are shown. The import profit of Brazilian soybeans has deteriorated, while that of Canadian rapeseed is good [70][74][77]. - **Domestic Inventory and Transaction**: Domestic soybean inventory is at a high level, soybean meal is in a stockpiling cycle but lower than last year, and the inventory days of feed enterprises are increasing. The inventory of domestic imported rapeseed has declined, and rapeseed meal inventory is being depleted. The transaction volume of soybean meal is normal, and the pick - up volume is high, while the transaction volume of rapeseed meal is also presented [81][102][109]. - **Feed and Livestock Farming**: The monthly output of feed is shown, as well as the breeding profits and related data of pigs, broilers, and laying hens. Pig prices are falling [116][118][122].

Core Insights - The current market environment shows similarities to late 2014, with investors in Hong Kong stocks, small-cap stocks, and industry sectors experiencing some profit effects, leading to a mild recovery in new product launches [1] - Non-financial sector profit expectations are nearing a bottom, with improved investor patience, although confidence still needs to be restored [1] - Policies aimed at reducing competition and boosting domestic demand are clear objectives, with specific policy implementations and adjustments expected soon, potentially showcased in the "14th Five-Year Plan" [1] Investment Strategies - The report maintains three strategic focuses for the mid-year reporting season: 1. Industries with strong industrial trend characteristics, focusing on AI and innovative pharmaceuticals [1] 2. Industries driven by performance and valuation matching, focusing on North American computing chains in telecommunications and electronics, as well as non-ferrous metals and gaming [1] 3. Industries with thematic and speculative characteristics, particularly related to military industry and new energy linked to reducing competition [1] - Overall, the rotation among non-ferrous metals, AI hardware, innovative pharmaceuticals, gaming, and military industries is expected to be the main theme during the mid-year reporting season [1]