Oilseed rape prices have firmed sharply since the turn of the year, with MATIF futures up by €10.75/t between 2 January and 6 January, to close at €358.50/t (£281/t).
Physical markets in the UK were about £4/t firmer than before Christmas, with the Farmers Weekly average at almost £260/t ex-farm for January – the highest spot price since mid-June 2014.
Markets were supported by concerns over drought in Argentina and heavy flooding in Malaysia, which could affect soya bean and palm oil production.
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“Globally, demand for oilseeds has been strong during the first half of this season, with global net exports forecast to be up by 3.7% year-on-year,” said Brenda Mullen at HGCA.
“In the EU, current forecasts for rapeseed crush margins have the potential to support continued demand during the latter half of the season.
“Looking ahead, with the majority of the world’s supplies of oilseeds produced in South America, focus will shift to how the soya bean crops in Argentina and Brazil develop, and price this into the market as necessary.”
Although El Nino weather could affect crop production, large planting forecasts in both South and North America had the potential to weigh on markets, she added.