By Olivia Cooper
TIGHT global supplies have pushed UK rape values up 20-30/t this year, despite continued record-breaking soyabean crops in the US and South America.
Since 1999, world rapeseed supplies have fallen 14%, to 37m tonnes.
UK OSR production was 2% down on last year as low yields more than offset a 10% rise in plantings.
And EU production continued its downward trend to 8.92m tonnes, compared with 9.05m tonnes in 2000 and almost 11.5m tonnes in 1999.
Weather problems in Canada and Australia have also curbed production, with Canada – the worlds largest exporter of rapeseed – a massive 2m tonnes down.
In contrast, the US harvested a second successive record soya crop and South America looks set to follow suit, preparing to overtake the US as the worlds leading soya exporter.
These huge stocks and slow US exports put soyabeans at contract lows throughout harvest, and prices are still struggling.
However, although UK markets usually shadow soya movements, this years rapeseed shortage has insulated them from such a pattern.
Values climbed steadily from 121/t ex-farm in February, to 151/t at harvest, and have remained fairly buoyant since then.
New crop plantings are estimated to be slightly up on last year, by about 3% in the UK, and total EU production is forecast to increase 10%, to 9.8m tonnes next season.
But planting figures from Canada and central and eastern European countries will not be known until the spring, and could have a significant impact on world prices and EU import levels.
Forward UK prices indicate that an expected increase in world output of rape and sunflower seed has slightly lowered new crop prices, with 142/t the value for November.
Currency changes will continue to play a major part in prices – if the Dollar starts to recover, import prices will rise in sterling terms, allowing for improved domestic values.
The opposite will happen should the Pound strengthen.
Despite the huge soya stocks, increased demand in Asia and China should provide some price support.
China has been approved to join the WTO and, as part of the agreement, has increased its import quota by 1m tonnes.
It has also recently agreed an interim deal with the US over allowing genetically modified imports, which is seen as positive.
But there are concerns that some countries in the EU are pressing to have the ban on meat-and-bonemeal in animal feed lifted, which would decrease demand for soya and rape meal.
Markets will remain volatile until South American plantings are confirmed, and Canadian cultivations get underway in the New Year.
UK prices, currently 161/t for June 2002, are likely to remain firm, especially as supplies tighten towards the end of the season.
But large soya stocks and a potential increase in other oilseeds could weigh on prices next year, although strong world demand will continue to provide support.
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