W9 Canola/Rapeseed Update: EU Rapeseed Imports Declined in the 2023/24 MY, Canada Records Record Canola Processing Amidst Export Decline

EU Rapeseed Imports Decline Amidst Supply Challenges

Between Jul-23 and Feb-24, the European Commission (EC) noted a significant decrease in rapeseed imports from 5.40 million metric tons (mmt) to 3.60 mmt. This decline is primarily due to a 12% year-on-year (YoY) drop in exports from Ukraine, the primary supplier, and a substantial 64.6% reduction from Australia due to adverse weather conditions. However, Moldova and Serbia have increased their exports by 170 thousand metric tons (mt) and 50 thousand mt, respectively.

The EC anticipates a decrease in European Union (EU) rapeseed consumption for the 2023/24 period, emphasizing the crucial role of Ukraine in meeting the needs of EU oil mills. Current data from the EC shows that rapeseed imports for the specified period were approximately 3.60 mmt, compared to 5.40 mmt in the previous year. Total imports for 2023/24 are estimated at 5.61 mmt, reflecting a decrease of 1.23 mmt or 18% YoY.

Ukraine remains the most significant supplier country, with 2.41 mmt of rapeseed, representing a decrease of almost 330 thousand mt or 12% YoY. Australia, the second most important source, provided 767 thousand mt, marking a reduction of 1.41 mmt or 64.6% YoY due to poor weather affecting the 2023 rapeseed harvest. Conversely, Moldova expanded its exports to the EU by 170 thousand mt to 233 thousand mt during this period.

EU Oilseed Processing Up in Jan-24, Rapeseed Stable

The European Association of Vegetable Oil Producers (FEDIOL) estimates that in Jan-24, EU oil extraction plants processed approximately 3.5 mmt of oilseeds, showing a month-on-month (MoM) increase of 44 thousand mt and a YoY increase of 226 thousand mt. Specifically, rapeseed processing amounted to 1.76 mmt during the same period, consistent with Dec-23 figures but up by 87 thousand mt compared to Jan-23.

Ukraine's Vegetable Oil Exports to EU Surged, Led by Rapeseed Oil and Meal

Between July 1, 2023, and February 22, 2024, Ukraine witnessed a notable surge in vegetable oil exports to EU countries, totaling over 1.72 mmt, marking a significant one-third increase compared to the previous year. Notably, shipments of rapeseed oil experienced a substantial increase, surging by 2.2 times to reach 111.85 thousand mt. Additionally, the export of rapeseed meal soared by 170% YoY. However, rapeseed exports declined from 901.9 thousand mt to 575.5 thousand mt during the same period.

Ukraine Expands Rapeseed Acreage, Eyes Record Harvest in 2024

Rapeseed acreage in Ukraine is expanding despite the import ban to neighboring countries, with experts predicting a record harvest in 2024. There is a significant increase in rapeseed production and export, with processing growing by 21% over the last two years. Analysts anticipate that rapeseed production in the Black Sea region will remain at a record high in 2024, with the potential for further growth if favorable weather conditions persist.

Altai Territory to Expand Rapeseed Cultivation to 181 thousand HA

The Russian Altai Territory Regional Minister of Agriculture announced at the Winter Grain Conference in Belokurikha that the area under crops in the upcoming season will expand by 25 thousand hectares (ha), focused on increasing oilseeds cultivation. Specifically, rapeseed cultivation will increase from 163 thousand ha to 181 thousand ha, according to the Ministry of Agriculture.

Record Canola Processing in Canada Amid Strong US Demand

In Jan-24, canola processing volumes in Canada reached 937 thousand mt, marking the highest figure for Jan-24 on record. The increase in processing, up by 7% YoY, is attributed to strong demand for Canadian canola oil from the United States (US). From Aug-23 to Jan-24, a record-breaking 5.5 mmt of canola arrived at local crushing facilities, compared to 4.9 mmt in the same period the year before. This surge in processing contrasts with a decline in raw material exports, which have decreased by a third since the beginning of the current crop year, dropping from 4.88 mmt to 3.28 mmt.