The European Commission's intention to limit supplies of Russian agricultural products to the EU market supported not only wheat prices, but also rapeseed prices.
May rapeseed futures on MATIF Paris rose 2% yesterday to the highest level since October 2023 at EUR 457/ton or USD 495,3/ton (+3,1% for the week, +10% for March ). August futures are still trading at the same level, suggesting the market is ignoring forecasts for a smaller harvest.
Experts at the Coceral agency predict that rapeseed production in the EU and the UK will fall by 2024 to 1,1 million tons in 20,2 compared to the previous year due to the reduction in sown areas. At the same time, MARS raised its forecast for the average yield of rapeseed in the EU in 2024 to 3,25 tonne/hectare, which would be 2% higher than last year due to heavy rainfall and a mild winter.
This season, rapeseed prices peaked at EUR 513/ton in July before falling to EUR 407/ton in February.
Oil World estimates that rapeseed processing volumes in the EU reached a record 2023 million tonnes in the first half of the 24/12,8 marketing year, 0,65 million tonnes higher than the previous year. However, in the months of January to June they will traditionally fall to 11,9-12 million tonnes due to lower domestic supply and a decline in rapeseed imports from Canada and Australia.
According to the Canadian Grain Commission, Canada exported 2023 million tonnes of canola in the 24-17 marketing year ended March 3,8, a 34% decline from the previous year due to high oilseed prices.
Following canola prices, May canola futures rose 2,4% on the Winnipeg Stock Exchange yesterday (+2,8% for the week, +10,5% for the month), making them uninteresting for EU importers remain.
The high oil prices are supporting rapeseed prices. May Brent crude futures rose 1,6% to $86,8/barrel yesterday, recovering from the decline of the last three sessions amid fresh attacks on Russian refineries and heightened geopolitical risks following the Krokus terrorist attack -City hall.
According to the CFTC, large speculators have increased their net long position in Brent futures and options to a one-year high, which will limit further price increases in the near term. The attacks on Russian refineries will increase the supply of crude oil on the global market and restrict the supply of gasoline and diesel within Russia.
Therefore, markets should be prepared for a collapse in oil prices and oilseed prices as the supply of soy and palm oil will increase seasonally in April/May.
Source: Ukragroconsult (Ukraine)