Stick with OSR despite low prices Glencore

By FWi staff

THE only cure for the UKs tumbling oilseed rape market is to continue with the low prices paid at present, according to James Read of Glencore Grain.

Speaking at the Marketing for Profit conference today (Wednesday), Mr Read told delegates that, before a price recovery could be seen, the current excess in production would have to stop.

But if British growers reduced their plantings, it would have no impact on prices, he said.

With world soya production increasing to 170 million tonnes, the two crops would be competing on the same market.

However, despite the tremendous and very sudden drop in prices, Mr Read maintained that oilseed rape remains the biggest UK money-making crop.

With a gross margin of £202/t this season, it was by far the highest earner when compared with winter feed wheat at £193/t.

And although this is expected to drop next year under Agenda 2000 proposals to £178/t, compared with wheat at £205/t, it would still be profitable, said Mr Read.

“There is no quick-fix solution to rape prices at the moment. But we have seen some start of a recovery with reduced plantings.”

Dont expect a £30 recovery but, on the basis of lower plantings, the outlook for oilseed will be good, he said.

Ex-farm prices edged to £115/t delivered this week as farmers remain reluctant sellers. Low prices and dry weather have kept producers attention on field work rather than marketing.

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