Low Yields in Ukraine Affect Global Rapeseed Prices
The Ministry of Agrarian Policy of Ukraine reported that as of July 4, domestic farmers harvested 285.9 thousand tons of rapeseed from 12% of the area (186.9 thousand hectares), compared to last year’s 47.7 thousand hectares. The average yield was 1.53 t/ha, down from 1.81 t/ha the previous year.
Paris Stock Exchange Sees Significant Price Increases
For two consecutive weeks, rapeseed prices on the Paris stock exchange have surged. August futures saw a 1.3% increase to €508.25/t or $550.4/t, a 10% rise in just two weeks, surpassing May’s high of €495/t. The price hike is attributed to the news of reduced rapeseed yields in Ukraine.
Canadian Canola Sales Fail to Halt Price Rise
Despite news of new Canadian canola shipments to the EU, rapeseed prices continued to climb. The price differential of up to $70/t suggests an acceleration in canola deliveries. On the Winnipeg exchange, November canola futures rose 1.2% to CAD 658/t or $482/t, marking a 6.5% increase over two weeks.
Canadian Export Limitations and Weather Conditions
The growth in canola prices is tempered by low export rates and favorable weather. StatsCan reported that Canada increased canola exports from 184 to 252 thousand tons during June 24-30, totaling 6.2 million tons for FY 2023/24, an 18% decrease from the previous season’s pace. Canada still has 1 million tons of old-crop canola available for delivery to the EU, potentially replacing rapeseed meal supplies from Russia and Belarus, now subject to import duties.
Ukrainian Market Dynamics and Export Prices
In Ukraine, delayed harvesting in central and western regions, coupled with farmers’ reluctance to sell, caused export purchase prices for rapeseed to rise to UAH 22,000-22,500/t or $480-495/t, with delivery to Black Sea ports. Demand prices for EU deliveries also increased by 10-20 €/t to 470-490 €/t, with shipments expected no earlier than October-November, as local producers are actively selling their rapeseed.
Oil Prices Influence on Rapeseed Market
Oil prices, currently at $86.4/barrel, continue to support rapeseed prices. However, potential political changes in Iran could lead to decreased tensions in the Middle East, possibly lowering oil prices and affecting rapeseed market dynamics.
The rising rapeseed prices highlight the interconnectedness of global agricultural markets and the impact of regional events on commodity prices. As farmers and traders navigate these changes, the importance of strategic planning and market awareness becomes ever more critical.