Rapeseed prices have fallen slightly, but are supported by a reduction in crops in Canada

Russia's war against Ukraine, which has been going on for 69 days, keeps oil and food prices high. Since the beginning of the invasion, rapeseed and canola prices have risen by 25-40% due to uncertainty over rapeseed production and exports from Ukraine.

In addition, prices were supported by a decline in the forecast of canola sowing areas in Canada. According to a report from the Canadian Bureau of Canada on April 26, despite high world demand for oilseeds, the country's canola sowing area will fall by 7% in 2022 to 20.9 million acres, as farmers will prefer wheat amid drought and demand uncertainty from China and the EU.

In Saskatchewan, the province with the highest rapeseed production, canola sowings will decrease by 1 million acres or 8% to 11.1 million acres in 2022 compared to the previous year, and in Alberta by 6.9% to 6.3 million acres. , in Manitoba - by 3.9% to 3.3 million acres.

According to the report, November canola futures rose 1.8% to 1125 CAD / t, but then began to fall and fell by 5.7% in two sessions to 1064.5 CAD / t or $ 827.88 / t, which is 25% higher than the price level on 25.02.2022.

August rapeseed futures on the European stock exchange MATIF reached 880.5 € / t on April 26, after which they fell by 8% to 814 € / t during the week, and the dollar price fell from $ 1,000 / t to $ 856 due to the depreciation of the euro / t.

According to the April forecast of MARS, the yield of winter rape in the EU in 2022 will be 3.2 t / ha, which will correspond to last year's level, but 4% higher than the average 5-year figure. The estimate of rapeseed production due to the expansion of sown areas increased to 18.1 million tons compared to 17 million tons last year and 17.4 million tons projected by the USDA, while the estimate of imports was reduced from 4.9 to 4 million tons.

In 2021/22 MY as of 25.04.22 the EU imported 4.288 million tons of rapeseed from the projected 6 million tons (5.5 million tons last year). The reduction in supplies from Canada has reduced imports, so if Ukraine receives a projected 3 million tons of rapeseed in the new season, imports from Canada will remain insignificant, especially since most Ukrainian rapeseed will be exported to the EU via the western border due to seaport blockade.

The area under winter rapeseed in Ukraine has been increased to 1.4 million hectares, but due to hostilities not all crops will be fertilized. Currently, the condition of crops is good, which allows us to expect a harvest in the range of 2.8-3 million tons.

The state of rapeseed crops in the EU is mostly good, so the attention of traders is focused on Canada, where weather conditions during the sowing of canola will be a new factor influencing world prices for rapeseed new crop.