Oilseed rape prices have dropped over the past week, tracking the weaker soya bean market in the US.
As Farmers Weekly went to press, spot values averaged £378/t ex-farm, £8/t down on the week. “Soya bean futures were limit-down on Monday, following a few better than expected yield reports in the US,” said Owen Cligg, trading manager at United Oilseeds. A big sell-off by futures traders contributed to the slide, he added. “Because the funds have held such a big position on soya beans, they had potentially large profits to cash in – and once one sells the herd mentality kicks in.”
However, fundamental supply and demand should keep the oilseeds markets underpinned, with the global market very dependent on a large South American crop. “There are potentially large canola crops in Australia and Canada, but yields are already below expectations in Canada, and dry weather in Australia will lead to downgrades there,” said Mr Cligg.
New crop values had slipped a bit, to £340-350/t ex-farm, with larger plantings in Germany and France likely to boost EU production. “But there are concerns in France over germination as it has been so dry,” he added. “We’ll just have to wait and see how crops pan out.”