Lower Rape Crop Provides Positive Outlook

By FWi Staff

FORECASTS of a lower EU rapeseed harvest have been confirmed, as combines clear crops.

Poor weather in the three main growing regions, Germany, France and the UK, has affected yields – in some areas of the UK they are down by 0.25-0.5t/acre. That, together with a smaller EU planted crop, have put latest estimates at 9.2-9.4m tonnes.

This is a drop of about 18% on last years output. “But it is still the third largest crop on record,” says John Martin from Banks Agriculture.

However, EU imports are expected to fall by nearly 35% to 550,000t, due to a predicted 10% fall in global oilseed production and a halt on GM imports from North America.

“But exports are going to be critical,” says Mr Martin. Forecasts have been slashed to 600,000t, compared with 2mt last year. If that target is met, it would leave European crushers, who use about 9mt/year, slightly short.

“China was our biggest taker last year, but this season it looks like they could give preference to soyabeans – a reflection of lower domestic rapeseed prices and rising EU seed prices.”

“The outlook is generally more positive than last year, but dont get carried away,” says James Read of Glencore Grain. “With the crop well down we are looking at a much tighter balance sheet. But until world and vegetable oil prices start to recover, rape is unlikely to increase much more.”

Prices this week are 113/t ex farm, compared with 110/t the same time last year. The November forward price is 120/t.