Oilseed market drifts lower – HGCA

SEED, meal and oil prices (except palm oil) were lower again last week, as a bearish US Department of Agriculture report contributed to an overall negative market sentiment.

The largest price drop was seen for MATIF rapeseed, falling to less than €200, the lowest value since harvest.

A continued weak US Dollar against the Euro plus unconfirmed reports that 200,000-300,000 tonnes of Australian canola is on its way to the EU, added to the bearish market outlook.

UK delivered prices lost 4-5/t.

Most imports from Brazil

BRAZIL was the main origin for the 340,000 tonnes of soyabeans and 270,000 tonnes of soyameal imported into the UK from non-EU countries between July and November this season.

A smaller domestic crop has lowered UK rapeseed July-October exports to 8200 tonnes from 118,000 tonnes a year earlier.

UK crop update

THE Ministry revised the non-set-aside rapeseed and linseed area for harvest 2000 lower to 332,300 and 71,500 ha.

International: USDA report disappoints

DATA released by the USDA on Thursday (11 January) did not meet the markets expectation.

The 0.16m-tonne US soyabean crop decline to 75.4m tonnes remained well below trade anticipation, and the reduction of the soyabean crush surprised.

With soyabean stocks unchanged, resulting fund selling activity pushed soya prices lower last week.

On the global scale, large world vegetable oil stocks at 7.9m tonnes are forecast to keep sentiment bearish over the market this season, while world oilseed stocks are forecast to fall from 31m in 99/00 to 27m this season, due to record demand.

Hopes pinned on China

HOPE remains placed on China, which has imported and continues to buy large amounts of soyabeans from the world market.

China is also expected to release its first batch of palm oil import quotas for the year at the end of the month.

This should help palm oil prices, currently trading at a 15-year low. Indeed, palm oil futures prices improved significantly for the first time since November last year.

This was aided by a drop in production and stocks and reports that Pakistan, a major buyer of Malaysian palm oil, is not planning to raise import duty before February.


Taken from HGCA weekly MI Oilseeds
To contact the HGCA phone 020 7520 3972

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