Rapeseed imports to the EU will exceed the 5-year average by 30%, which will increase pressure on prices

USDA experts in the April report predicted an increase in the consumption, processing and trade of rapeseed in the EU in the new season to a record level. Thus, the import of rapeseed to the EU in the current season will amount to 6.7 million tons, which will exceed the average 5-year figure by 30%.

As of April 9, the EU has already imported 6.363 million tons of rapeseed, which is 59% higher than last year's pace. In particular, deliveries from Ukraine increased from 1.62 to 2.94 million tons, and from Australia - from 1.573 to 2.822 million tons. At the same time, deliveries from Canada almost halved - from 538 to 230 thousand, despite a significant increase in the canola harvest in the country , as domestic processing has increased and canola prices are higher than canola.

According to the USDA forecast, in 2023/24 MY, rapeseed production in the EU will increase, as well as imports from Ukraine and Australia due to an increase in the harvest.

May rapeseed futures on the Euronext exchange fell by 10.5% since the beginning of the month to €443/t or $490/t (-9.5% for the month) against the background of lower prices for rapeseed oil in the EU market and active imports rapeseed, which reached 432,000 tons during the period April 1-9.

At the same time, the price of May canola futures on the Winnipeg exchange stabilized at 770 CAD/t or 577 $/t (+1.7% for the month) in April, supported by active exports of canola and canola oil.

Soybean oil prices in the US are supported by lower forecasts for the soybean harvest in drought-stricken Argentina. This, in turn, supports the prices of rapeseed oil, which in the US has been allowed to be used for the production of biodiesel.

Once canola prices have bottomed out, they will remain stable for several months pending updated crop forecasts in Australia and Canada.