February rapeseed futures on the Paris exchange rose to a 3-year high

Despite the drop in oil and soybean prices by 5-8% for the month, quotes for rapeseed continue to rise on forecasts of a reduced harvest and curbing sales by farmers in the EU.

 

Yesterday at Paris MATIF, February rapeseed futures rose 1.1% to the highest level since November 2022 at €520.75/t or $565/t (+1.5% for the week, +8.5% for the month ) due to uncertainty with canola supplies in the second half of the season due to a reduced crop in Australia, curbed sales by EU farmers and a lack of canola supplies from Canada.

 

At the same time, spot prices for rapeseed with delivery to the plant in November-December remain at the level of 500-515 €/t, as processors have accumulated the necessary stocks.

 

According to the European Commission, in 2024/25 MR (as of October 25), the EU imported 1.75 million tons of rapeseed (5% more than in the same period of 2023), of which 1.27 million tons were supplied from Ukraine, 351 thousand tons - from Australia and 63 thousand tons - from Moldova, while canola deliveries from Canada were not recorded.

 

November canola futures on the Winnipeg exchange fell 2.6% in three sessions to CAD 625/t or $449/t (-1.3% for the week, +2.3% for the month) under pressure from lower prices on soybeans in Chicago.

 

Due to the depreciation of the euro and the Canadian dollar against the US dollar, canola prices are $115/t lower than canola in Europe, which should accelerate canola shipments from Canada to the EU.

 

In Ukraine, export purchase prices for rapeseed in Black Sea ports increased by 200-300 UAH/t to 24,600-24,800 UAH/t or $510-520/t during the week, however, against the background of reduced offers between traders, the struggle for volumes is intensifying.

 

Since 2014, EU countries have been gradually reducing rapeseed production and increasing its imports, including from Ukraine. This is caused by crop rotation restrictions, a ban on the use of pesticides and other factors. However, in the near future, the potential for increasing rapeseed imports to the EU will be exhausted, LMC analyst Aaron Hensos said at the "Fat-and-Oil Industry-2024" International Conference.

 

If in 2014 the EU consumed 91% of its own and 9% of imported rapeseed, then in 2024 these figures will be 71% and 29%, respectively. Ukraine provides a third of this import, but there are risks of a decrease in rapeseed imports to the EU, as well as Ukraine's share in it.

 

At the same time, the demand for sunflower oil is growing in the EU and the demand for palm oil is falling. The demand for rapeseed oil depends on the biofuel policy, but the general trend here is negative, so the EU may reduce rapeseed imports in the future.