By FWi staff
THE UK oilseed rape market continued its downward decline last week and has started this week looking no better.
The reasons behind the falling values remain the same, said a spokesman from the Home-Grown Cereals Authority.
Financial crisis in Brazil and a favourable outlook for the South American soyabean crop continue to put pressure on the market.
The expected large carryover stocks in the USA, along with a general lack of export demand, pushed Chicago soyabean futures almost to a 12-year low last Friday (29 January), noted the HGCA.
Rapeseed prices have lost more than £24/t in the UK over recent weeks. However, crush margins continue to get squeezed despite these lower values as the oil prices slide even further.
Ex-farm prices finished a volatile week at about £134/t on Friday. Futures prices are little better at £143/t for March deliveries.
Considering the current market situation, price prospects are not looking promising, noted the HGCA.
But uncertainties like the weather will continue to play an important part of any price developments and should be monitored closely, said a spokesman from the HGCA.
“This is at present particularly true for the development of the South American soya crop, where weather conditions over the next weeks will determine the size and quality of this years crop,” he said.
Adding further misery to the low prices was the announcement of the area payments which were confirmed at the end of last week. Final payments for the 1998 harvest are to be £70 below last years at £303.80/ha.
This follows a 7% adjustment as well as a 23.73% area penalty.