Rapeseed prices have received support from lower crop forecasts in the EU and India, signaling potential shifts in the global oilseed market.
The agency Strategie Grains revised down its forecast for rapeseed harvest in the EU for 2024, attributing the adjustment to reduced sowing areas. The new forecast stands at 18.3 million tons, reflecting an 8% decline from last year’s production of 19.9 million tons. This reduction, particularly notable in countries like Romania and Poland, is expected to boost rapeseed imports to Europe, primarily from Ukraine and Australia, although supply from these sources may be constrained. Additionally, shipping disruptions in the Red Sea may redirect canola supplies from Australia to Canada.
In contrast, the agency maintained its predictions for sunflower and soybean harvests in the EU for 2024, foreseeing increases of 9% and 8% compared to 2023, respectively.
In India, adverse weather conditions, including heavy rains and hail, have damaged winter crops such as wheat and canola, delaying harvesting. The looming threat of hot weather in March poses additional stress on crops.
Rapeseed futures on the Paris MATIF saw a 2.4% increase for the week to €417.25/t or $452.8/t, driven by production cut forecasts. However, these gains are tempered by falling prices for soybeans and other oil crops.
Meanwhile, canola futures on the Winnipeg exchange rose by 1.3% last week to $439/t or €404/t, despite a 1.3% decrease for the month.
With Canadian canola remaining competitively priced compared to European varieties, the EU may ramp up purchases amidst reduced supplies from Ukraine and heightened prices from Australia due to shipping disruptions in the Red Sea.
The blockade of the border with Poland has led to a decline in demand prices for rapeseed in western regions of Ukraine, while port prices remain relatively stable.
Overall, prices for new crop canola have yet to react to forecasts of reduced production, remaining at similar levels for now.
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