Rapeseed prices are rising in line with vegetable oil prices

Despite significant global supply and stocks of oilseeds, including rapeseed, prices continue to gradually recover from February’s decline amid rising oil and palm oil prices, as well as forecasts of a decline in European rapeseed production.

According to the forecast of the Coceral agency, EU countries and Great Britain will harvest 20.2 million tons of rapeseed in 2024, which is 1.1 million tons less than the 2023 harvest.

May Brent crude futures rose to a 5-month high of $87.4/bbl on Tuesday, but fell 1.6% to $86/bbl yesterday (+2.4% for the week, +4.6% per month) against the backdrop of profit-taking by traders and strong pressure on the dollar.

The market was supported by data from the EIA agency, according to which US crude oil inventories fell by 2 million barrels to 445 million barrels during the week, although analysts expected a decrease of 1.2 million barrels.

May palm oil futures on Bursa Malaysia rose 1.7% yesterday to RM4,272/t or $909/t (+1.8% on the week). Following them, the May futures for soybean oil on the exchange in Chicago rose by 1.7% to $1,079/t (+1% for the week).

Against this background, May canola futures on the Winnipeg exchange rose 2.2% yesterday to CAD 648.5/t or $481.65/t (+3.8% on the week). They were supported by a new report from the Canadian Food and Agriculture Organization of the United States (AAFC), in which the forecast for canola production in FY 2024/25 was lowered by 0.3 to 18.1 million tons, which would exceed the FY 2023/24 crop by 0.2 million tons.

May rapeseed futures on the Paris MATIF rose by 1.3% yesterday to €452/t or $494/t (+2.9% for the week, +6% for the month).

Speculative growth in oil and vegetable oil prices will be limited by a reduction in demand from India and China, as well as a seasonal increase in the supply of soybean oil from South America and palm oil from Asia, which will begin as early as April, especially since Argentine analyst Dr. Cordonier raised forecasts of soybean and corn harvest in the country by 1 million tons to 51 million tons and 55 million tons, respectively.

Tags: prices, rapeseed, edible oils