Quotations for rapeseed in Paris reacted very sluggishly to another decrease in the forecast of the harvest in the EU

Yesterday,  the Strategie Grains agency again lowered the forecasts for the production of agricultural crops in the EU, which supported stock market quotations.

Rape prices on the stock exchange in Paris, after falling the week before last to the lowest values in the season, gradually recovered to the level of prices at the beginning of August. Traders almost did not react to the significant decrease in the forecasts of the rape harvest in the EU and Ukraine and the worsening of the balance of rape in the EU for 2024/25 MY.

Last week, the European Commission lowered the official forecast for the 2024/25 EU rapeseed harvest from 18.4 to 18 million tonnes, which would be 9.4% below the 2023/24 harvest of 19.7 million tonnes, while the USDA in August estimated it at 18.9 million tons. The import forecast was left at the level of 5.85 million tons, and the final stocks were estimated at 833 thousand tons.

Yesterday, for the fourth time this season, the Strategie Grains agency lowered its forecast for the rape crop in the EU in 2024 from 17.27 to 16.9 million tons due to production cuts in Germany, France, Hungary, Slovakia and the Baltic states. The forecast for the sunflower harvest in the EU has been reduced from 9.65 to 9.3 million tons (9.8 million tons in 2023), which will increase the shortage of raw materials for European processors.

We will remind that in 2024, Ukraine harvested 3.4 million tons of rapeseed from the forecasted 3.7-4 million tons, so it will reduce exports from 3.3 to 2.7-2.8 million tons.

Given the new forecasts, the European Union will need to import an additional 2-3 million tons of canola, but the canola crop forecast for Australia has been lowered, while it will remain at the level of last year in Canada.

According to the official forecast of ABARES, canola production in Australia will decrease compared to 2023 by 8% to 5.5 million tons, which will exceed the 10-year average by 22%.

The Canadian Bureau of StatCan predicts that the canola crop in the country in 2024/25 MR will grow compared to the previous season by 1.6% to 19.5 million tons (the USDA estimates it at 20 million tons), but local analysts expect a slightly lower figure of against the backdrop of dry weather in some provinces.

November rapeseed futures on the Paris exchange during the week rose by 2.4% to €471.25/t or $521/t (-0.2% for the month, -2.8% for the year).

In Ukraine, the purchase prices for rape with delivery to Black Sea ports increased by 200-300 UAH/t to 22,600-23,000 UAH/t or $475-485/t during the week. Farmers are actively selling canola and curbing sales of wheat and barley amid low prices, as well as sunflower due to a poor harvest.

In the Canadian province of Saskatchewan, on August 29, canola was harvested on 8% of the area, and favorable weather will soon allow to increase the volume of offers.