Rapeseed Market Remains Stable – Weather Conditions in Argentina in Focus
Market Development and Price Movements
The rapeseed market has shown little movement recently. The May contract on Euronext closed unchanged at 516.50 EUR/t on Monday. New crop contracts saw slight increases.
A similar trend was observed in the soybean market in the U.S. The front-month March contract on the CBoT also ended the day unchanged at 1,046.5 ct/bu (approximately 385.0 EUR/t). Later maturities finished the session mixed, with soybean meal and soybean oil recording slight losses.
Key Market Drivers and Influences
U.S. Tariffs and Trade Conflicts
The soybean trade in the U.S. initially came under pressure on Monday following President Trump’s announcement of 25% import tariffs on steel and aluminum. Fears of retaliatory measures that could negatively impact soybean exports weighed on sentiment.
Weather Conditions in Argentina
Improved weather conditions in Argentina had a bearish effect on prices. Additional rainfall is expected this week, which could ease drought concerns.
Bullish Canadian Canola Market
Unexpectedly low canola stocks in Canada, reported by StatsCan on Friday, are driving canola prices higher. The March canola contract on the ICE rose by 5.00 CAD to 661.80 CAD/t, reaching the highest level since November 12.
- The increase was partly due to massive purchases by commodity funds that had been previously bearish due to fears of a trade war with the U.S.
- Analysts now view the Canadian canola market as bullish, as low supply is expected to support prices.
Export Data and USDA Report
USDA Export Inspections Report (Week Ending February 6)
The USDA export inspections report indicated:
- A total of 1.104 million tons of soybeans were shipped.
- This represents a 3.2% decrease from the previous week.
- 18% lower than the same week last year.
- Top destinations:
- China: 554,661 tons
- Egypt: 159,855 tons
- Germany: 68,656 tons
Brazilian Soybean Harvest Progress
The 2024/25 Brazilian soybean harvest reached 15% of the planted area as of last Thursday, a 6 percentage point increase from the previous week. However, the pace remains behind last year’s progress (23%).
WASDE Report Expectations (To Be Released Tuesday)
According to a Reuters poll of analysts, expectations for the upcoming WASDE report include:
- U.S. soybean ending stocks: Reduction by 6 million bushels to 374 million bushels.
- South America forecasts:
- Brazilian soybean production: Increased by 0.64 million tons to 169.64 million tons.
- Argentinian soybean production: Reduction by 1.51 million tons to 50.49 million tons.
- Global soybean stocks: Expected to decline by 0.58 million tons to 127.79 million tons.
Weather Update – Argentina’s Soybean-Growing Regions
The latest weather conditions for Buenos Aires and surrounding soybean-producing regions:
| Date | Weather Conditions | Temperature (High/Low) |
|---|---|---|
| Tue, Feb 11 | Heavy showers, cooler | 23°C / 19°C |
| Wed, Feb 12 | Sunny | 25°C / 19°C |
| Thu, Feb 13 | Sunny and mild | 28°C / 21°C |
| Fri, Feb 14 | Increasing cloudiness | 29°C / 21°C |
| Sat, Feb 15 | Morning showers, humid | 27°C / 20°C |
| Sun, Feb 16 | Hot and humid | 30°C / 20°C |
| Mon, Feb 17 | Continuous sunshine | 29°C / 17°C |
Weather Alert for Buenos Aires:
- Severe storm active until 17:59 ART
- Threats:
- Heavy rainfall (20-45 mm)
- Thunderstorms, hail, strong wind gusts
- Recommended precautions:
- Avoid outdoor activities.
- Stay away from trees and power lines.
- Keep emergency supplies ready.
These weather conditions could impact soybean and rapeseed production in Argentina, potentially influencing global supply and prices.
USDA Export Inspections – January 2025 (Summary)
Here are the key export figures for January 2025:
| Region | Country | Wheat (t) | Yellow Corn (t) | White Corn (t) | Sorghum (t) | Soybeans (t) | Total (t) |
|---|---|---|---|---|---|---|---|
| Lakes | Mexico | 10,777 | 0 | 0 | 0 | 0 | 10,777 |
| Atlantic | Algeria | 0 | 0 | 0 | 0 | 85,950 | 85,950 |
| China | 0 | 0 | 0 | 0 | 5,977 | 5,977 | |
| Italy | 0 | 0 | 0 | 0 | 50,849 | 50,849 | |
| Gulf | Egypt | 38,303 | 0 | 0 | 0 | 365,867 | 404,170 |
| Germany | 0 | 0 | 0 | 0 | 241,220 | 241,220 | |
| Pacific | China | 0 | 0 | 0 | 69,299 | 811,659 | 880,958 |
| Japan | 271,653 | 1,043,816 | 0 | 0 | 9,854 | 1,325,323 | |
| Korea Rep. | 258,234 | 696,132 | 0 | 0 | 0 | 954,366 |
Conclusion
- U.S. tariffs continue to create uncertainty in the market, though trade negotiations with China could ease tensions.
- Weather conditions in Argentina are improving slightly, though rainfall distribution remains uneven.
- The Canadian canola market remains bullish due to low stock levels.
- USDA export figures show weaker soybean shipments, though China remains the primary buyer.
The coming days will be crucial, particularly with the release of the WASDE report and ongoing weather developments in Argentina.
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