Market report: Oilseed rape benefits from falling pound

Oilseed rape values have improved again this week, as the pound has weakened further against the euro.

Spot values reached about £250/t ex-farm on Wednesday (10 March), depending on location – £4/t up on the week. Stronger crude oil prices and tighter EU supply had also contributed to the rise, said Hugh Schryver of Glencore Grain.

“Fewer imports and better demand for oil from the biodiesel sector mean the EU carryover into next season is expected to be nearer 300,000t than the 1m tonnes predicted earlier. However, the large South American soya crop is likely to pressure the oilseeds markets as the weeks pass.”

Unfortunately, large EU and UK cereal stocks meant wheat and barley failed to benefit from the weaker pound, which reached €1097 on Wednesday (10 March). However, it did insulate prices from a falling French market. “The heavy surplus of wheat in France is beginning to tell, and prices are comfortably competitive with vessels from the UK,” said Mr Schryver.

“It seems future exports of feed wheat are going to have to find their way out of the EU as demand within the Community remains slow. The exchange rate probably remains the most influential factor affecting our markets over the coming weeks.”