Prices for rapeseed and canola rose by 4-8% over the week amid a possible decrease in the EU harvest

Despite significant stockpiles, a 3.2% decline in oil prices and a slowdown in global exports, prices for rapeseed and canola rose by 4-8% during the week amid frosts in northern Poland and Germany that could damage crops.

After a speculative rise in price caused by the escalation of the conflict between Israel and Iran, oil prices continue to fall, and July futures for Brent crude oil for the week fell by 3.2% to 83.2 $/barrel.

August futures for rapeseed on the Paris MATIF exchange increased by 4% to 477.5 €/t (+5.5% for the month) or 512.9 $/t.

Experts of Strategie Grains in the may report left the forecast of rapeseed production in the EU in 2024 at 18.1 million tons (which is 9% lower than last year’s 19.5 million tons), given the good weather conditions in the main growing regions.

In 2023/24 MY, the EU reduced the imports of rapeseed by 34% to 4.22 mln tonnes compared to the previous season, 65% of which were supplied from Ukraine.

Following the prices of rapeseed in the EU for the week on the Winnipeg stock exchange, the July canola futures rose 8% to 668 CAD/t or 485 $/t, and November – by 7.4% to 682 CAD/t or 495 $/t, despite the increase in stocks and the decline in exports in Canada. Such a price jump will not allow Canada to increase supplies to the EU this season, although a week ago the price of canola was 40-50 $/t lower than that of rapeseed, which made it very attractive to European buyers.

According to StatsCan, the canola stocks in Canada as of 01.04.24 amounted to 8.2 mln tonnes, up 17% compared to 01.04.23 (7 mln tonnes). The export of canola in 2023/24 MY decreased by 48% from 6.04 mln tonnes to 4.07 mln tonnes, including 672 thsd tonnes in March (923 thsd tonnes in March 2023).

According to the estimates of Oil World (Germany), the global exports of rapeseed and canola in Q1 of 2024 decreased by 15% to 4.3 mln tonnes compared to the same period of 2023, in particular from Australia – from 1.9 mln tonnes to 1.7 mln tonnes, Canada – from 2.5 mln tonnes to 1.5 mln tonnes, Uruguay – from 0.3 mln tonnes to 0.1 mln tonnes. At the same time, exports from Ukraine increased from 0.31 to 0.79 million tons, and from Russia remained at the level of 0.2 million tons. In March, the total exports from Australia, Canada, Ukraine and Uruguay (which account for 95% of the world exports) decreased by 24% to 1.37 mln tonnes compared to March 2024.

The main buyers of rapeseed in Q1 were the EU and China, which reduced purchases from 1.8 to 1.7 mln tonnes and from 1.7 to 1.1 mln tonnes, respectively.

Tags: EU, prices, Canada, rapeseed, crop forecast