Increased biodiesel production supports rapeseed prices in Europe

Rape Leaves
Market & Price Trends
Published Apr 17, 2024

Tridge summary

In early April, a report by highlighted a significant increase in rapeseed prices in Europe, largely due to macroeconomic factors such as a spike in oil prices amid rising tensions in the Middle East, with Brent crude nearing a five-month peak at $90 a barrel. This surge in oil prices has a direct impact on rapeseed costs, a key ingredient for biodiesel production, pushing the May canola contract on the Paris exchange from EUR438/t at the end of March to EUR460/t by April 15. The increase is also fueled by an expected rise in global biodiesel production to a record 62.5 million tons in 2024, according to Oil World, with demand from the biofuels sector significantly outstripping that from the food sector for the fourth consecutive season. Additionally, a forecasted decrease in the EU's new rapeseed crop for 2024 to 19.13 million tonnes from 20.06 million tonnes in 2023 is contributing to the upward pressure on prices.
Disclaimer: The above summary was generated by Tridge's proprietary AI model for informational purposes.

Original content

At the beginning of April, highlighted the renewal of the upward trend in the prices of rapeseed in Europe, mainly determined by macroeconomic factors and, above all, by the increase in the price of oil due to the escalation of tensions in the Middle East. Stock analysts said Brent crude was trading in New York near a five-month high of $90 a barrel "as strong supply and demand fundamentals combine with a significant dose of geopolitical risk." As I already noted in our previous roundup (EU rapeseed prices on the rise again), this situation provides very strong support for the prices of rapeseed, widely used for biodiesel production, which are on the rise. On April 15, the price of the May canola contract on the Paris exchange rose to EUR460/t, compared to EUR 438/t at the end of March and the price floor of around EUR406/t marked at the end of February. The physical market follows the dynamics of futures. Rapeseed is currently quoted on the physical market at EUR460/t ...
Source: Sinor
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