What are the prospects for the Ukrainian rapeseed harvest in the new season?
The approach of the new season, the unstable operation of the grain corridor, the continuation of the EU ban on the supply of agricultural products from Ukraine to 5 neighboring countries forces traders to think about the prospects of the Ukrainian rapeseed harvest in 2023/24 MR.
In the May report, the experts of the MARS agency increased the forecast of rapeseed yield in Europe in 2023/24 MR from 3.31 to 3.34 t/ha (3.33 t/ha last year) in comparison with the April estimates. It is expected that the rapeseed area will grow for the fourth year in a row, so the harvest will exceed last year's by 3.3%.
The main European producers of rapeseed - France, Germany, Poland and Romania in 2022/23 MR were at the same time the largest importers of Ukrainian rapeseed. In 2023, they will increase rapeseed production compared to the previous year:
- France - by 0.7%,
- Germany – by 5.4%,
- Romania – by 33.6%,
- Poland - will reduce by 7.7%.
In 2022/23, Ukraine reduced rapeseed exports to Germany, Belgium and France, but significantly increased supplies to Romania and Poland. However, this did not significantly change the product flows within Europe - the largest European producers of rapeseed oil - Germany, Belgium, France, the Netherlands and the Czech Republic - remain the final consumers. At the same time, rapeseed stocks in the EU for the beginning of 2023/24 MR have grown significantly.
The European Commission extended the duty-free trade regime with Ukraine until June 2024, but extended the ban on the supply of Ukrainian rapeseed to Romania, Bulgaria, Poland, Hungary and Slovakia until September. Given the significant carryover stocks and forecasts of increased own production, the EU may extend this ban until the end of 2023 to protect the internal market.
In FY 2022/23, rapeseed production and export in Ukraine reached record levels. According to the forecast of APC-Inform, compared to the previous season, rapeseed exports will increase by 26% to 3.4 million tons. In 2023/24 MR, the rapeseed harvest will remain at the level of the previous season - 3.6 million tons, but the situation with exports will be more difficult. It may remain at the level of 3.4 million tons, but it will be stretched over time.
In general, rapeseed exports will depend on several factors. First, it is a ban on deliveries to 5 neighboring EU countries, where 55% of the total volume of rapeseed exports from Ukraine was shipped in 2022/23 MR. At the same time, the share of Ukraine in the total import of rapeseed to the EU increased to 42%.
Secondly, the increase in own production of rapeseed in the EU against the background of falling rapeseed oil prices and the crisis in the biofuel industry worsens the prospects for exports from Ukraine.
In addition, precisely at the beginning of the new rape season in Ukraine, the extension of the grain agreement should take place, which will increase the load on logistics in the direction of the Danube ports and the western borders, as a result of which delivery terms will increase.
