Rapeseed production in Australia exceeded the forecast by 400 thousand tons and last year's figure by 1.2 million tons

According to a consulting report on the rapeseed market by Chinese analytical company SunSirs, Australian rapeseed production in the 2025/26 MY reached 7.65 million tonnes, exceeding the forecast of the Australian Bureau of Agricultural Resources, Economics and Science (ABARES) on December 2 (7.23 million tonnes), the USDA estimate (7.2 million tonnes) and the previous season's figure (6.4 million tonnes).

Meanwhile, Western Australia has seen record production, which will significantly increase the supply of raw materials for meal and lead to a decrease in spot prices. If demand does not grow in sync with supply, there will be a surplus of rapeseed on the market.

Data showing that production exceeded forecasts accelerated the decline in prices, which, against the backdrop of increased global production and weak demand, will lead to a further decline in quotes.

Due to the increase in its own rapeseed production from 16.77 million tons in 2024 to 20.16 million tons in 2025, the European Union reduced rapeseed imports in the first half of the current season by 43% to 1.85 million tons compared to the previous season, which increases the pressure on canola prices in Canada and Australia. At the same time, supplies from Ukraine decreased by 45.4% to 1.141 million tons, and their share in European imports decreased from 62.9% to 58.8%. Supplies from Australia decreased by 71.3% to 250 thousand tons, and their share decreased from 26.2% to 12.9%.

The agreement between China and Canada to reduce tariffs and resume Canadian canola supplies to China reduces the prospects for canola exports from Australia to China. Therefore, in the second half of the season, the market will have an increased supply of canola from Australia and Canada, which will be difficult to sell without lowering prices.

Currently, Australian canola prices are $750-770/t FOB or $505-520/t.

March canola futures on the Winnipeg exchange have risen 5.5% year-to-date to CAD 636/t or $460/t amid the signing of an agreement to resume canola supplies to China, but their further growth is limited as the market is unsure whether China will be able to buy large volumes of canola, especially given that it has already purchased about 12 million tons of soybeans from the US (almost all of it for reserves). Moreover, the market expects a new record soybean harvest in Brazil, which is also becoming cheaper under pressure from purchases from the US.

February rapeseed futures in Paris, after falling before Christmas to an annual low of €450/t, rose by 4.7% to €474.25/t or $556/t, but it should be noted that May futures are trading €6/t cheaper, so the market expects prices to decline.