Oilseed under par
OILSEED rape markets have come under heavy harvest pressure this week, forcing ex-farm prices down to about £161 to £163/t for immediate movement.
These values are more than £10 lower than they were two weeks ago and have opened a significant gap on prices later in the year.
Three factors have hit the trade, according to Nick Oakhill of merchant Usborne:
• Movement pressure and a lack of haulage.
• Lack of buying interest from crushers.
• Lower soya prices in the US as growing conditions improve.
UK rape yields have also been good, with most crops coming in at over 3t/ha (1.25t/acre) and this is adding to the bearish tone.
Traders say these problems have been exacerbated by the Erith crushing plant in Kent (which buys much of the oilseed from southern England) taking only a limited amount of domestic rape, as it is preoccupied with imported Polish supplies.
A spokesman for ADM, which owns Erith, said it was still honouring its "as available" purchases from merchants, but most of its rape was bought on "buyers call" contracts.
"Crushers are not buyers in the harvest slot and may not come in until October," said Keith Davies of Glencore Grain. "The only real market for those who have to shift rape is into merchants stores."
and, with all combineable crops now coming off and in excellent condition, these are filling up quickly."
But he remained optimistic for a price recovery later in the season when big buyers such as China and Mexico come to the market for seed and oil.