The end of sowing and favorable weather in Canada reduces the price of rapeseed and canola
The late and dry spring in Canada in May led to a sharp speculative increase in prices for rapeseed and rapeseed, but active sowing and favorable rains reduced speculative pressure, so prices are falling sharply.
Canola sowing was completed 3-6% ahead of last year's and average annual rates. Last week, heavy rains took place in the country, which had a positive effect on crops. However, in some areas, excessive precipitation caused flooding. Next week, cool weather with light precipitation will continue to improve the condition of crops.
Weather in Canada and precipitation in Australia during the sowing season increased pressure on quotes, especially against the background of falling prices for palm and soybean oil. Starting Monday, July canola futures on the Chicago Stock Exchange fell by 6.7% to 815.2 CAD/t or 6 664.1/t, and November – by 7.7% to 692.6 CAD/t or 5 564/t. for the month, July futures fell by 12.9%, while November – by 6% due to the fact that in early June, hot weather forecasts reached the level of 770 CAD/t or $627.3/ton.
The seasonal decline in palm oil prices was significantly stronger than expected, and since the beginning of June it has already amounted to 20%, which increases pressure on neighboring oilseed markets.
On Euronext in Paris, August rapeseed futures, which have been getting cheaper since June 8, fell another 9.75 €/ton yesterday to 498.25 €/ton or 6 600.4/ton, losing almost 9% of the price in a week.
In Ukraine, cold weather with excessive precipitation leads to lodging of winter barley and wheat crops, but so far contributes to the development of rapeseed crops. However, the harvest forecasts remain unchanged and are inferior to last year's figures.
Forward prices for rapeseed delivered to the port in July – August after a speculative jump to 6 650-660/ton since the beginning of the week decreased to 6 610-615/ton for a basic oil content of 42%. More and more processors plan to increase the volume of rapeseed processing in the new season, which will dramatically increase competition with exporters, although usually only 10% of the rapeseed crop is processed in Ukraine, and the rest is exported to the EU.
