Agency Strategie Grains once again lowered forecasts for rapeseed and sunflower crops in the EU, which supported the quote

As a result of unfavorable weather in Eastern Europe, the Strategie Grains agency reduced the forecast for the sunflower harvest in the EU in 2024 by 0.4 million tons to 8.9 million tons, which will be 10% less than the 9.8 million tons harvested in 2023. Harvest data confirm poor sunflower yields, which in Romania and Bulgaria will be the lowest in the last 15 years, and in Hungary will be 5% below the 5-year average. In France, slow plant development will delay harvest and make it vulnerable to bad weather.

For the fifth month in a row, the agency has reduced the forecast for the rapeseed harvest in the EU, now by 0.2 million tons to 16.7 million tons, which will be 16.5% lower than in 2023. The production forecast has been reduced the most for Germany. Falling yields and stronger demand are exacerbating canola shortages in the EU, despite forecasts of a sharp increase in supplies from Canada thanks to high processing margins.

The correction of forecasts will support the prices of oilseed crops, in particular rapeseed and sunflower, in Europe and Ukraine due to the significant shortage of these crops and vegetable oils in the balance sheets of the EU and the world.

Strategie Grains experts left the forecast for the soybean harvest at 2.9 million tons. From December 30, the new EU Deforestation Regulation (EUDR) comes into force, which prohibits the import of agricultural products, in particular soybeans and palm oil, obtained from areas after deforestation, which could lead to higher soybean prices.

Also, Strategie Grains predicts that in the next season, the area planted with rapeseed will grow by 4%, while the area under sunflower will remain at the level of the current year.

November canola futures on the Paris MATIF reacted to a cut in the crop forecast by up €0.5/t to €470/t or $523.5/t, although they were down 1.1% for the week amid market uncertainty biofuels in the 4th quarter after the expiration of _CO2 certificates for 2023-24. At the same time, February rapeseed futures are trading 2% higher, at €479.75/t or $535/t.

An increase in Canadian canola crop forecasts is adding pressure to quotes, but harvest delays and early frosts could significantly reduce yield potential. Canada's MSG raised its 2024/25 canola crop forecast by 0.4 million tons to 19 million tons, which will almost match the previous season's 19.2 million tons.