The global rapeseed production for the 2022-23 marketing year is forecasted at 85 million mt, estimated to be up 16% YoY owing to a significant upward revision of the Australian crop, the EU crop, expected recovery in Canadian canola and other positive crop progress in Asia.
The Australian crop already reported by Tridge is revised up to 7.3 million mt up 0.28 million mt for the 2022-23 marketing year. That said, the Canadian rapeseed crop, otherwise known as canola, is expected to see some recovery at 18.2 million mt, up 32% YoY. So far this season, 8.6 million ha has been harvested. A strong recovery in yields this year to about yields at 2.1 mt per hectare after widespread dryness the previous year has been the driving force. Australia alone could export 6.8 million mt of its output.
This and the record production in Australia are causing market players to argue that Australia is likely to surpass Ukraine and become the leading supplier of rapeseed to the EU amid a gradual increase in oilseed exports for the latter.
EU production of rapeseed is also forecasted up 15% from 17 million mt in the 2021-22 marketing year to 19.5 million mt this marketing year. The 3.33 mt per hectare yield this year is also a slight improvement over the 3.21 mt per hectare last season. This rise comes from increases in main EU production countries, Germany, France, and the United Kingdom, where a rainfall deficit was offset by excesses that prevailed in the preceding months.
Production in Hungary, Bulgaria and Croatia have seen downward revisions- even troubling is the fact that drier than normal conditions are forecasted which may impact crop progress. In Ukraine, another top rapeseed producer, considering what has been happening over the last year, the winter rapeseed harvest projection is not bad at all. Production is expected to be at 3.3 million mt.
Besides the slight crop increase in the EU, production is expected to push imports from the rest of the world up. For this marketing season, imports from Ukraine are expected to see strong gains, up 25% from the 5-year trimmed average to 2.2 million mt. Its imports from Australia will also shoot up significantly to 1.19 million mt. That drive in imports is already seen in current shipments. From July 2022 to March 12, EU countries together imported 5.7 million mt of rapeseed, which is more than 1.5 times higher than the level in the same period last season.
Export prices of all exporting countries have edged down, driven by the positive fundamental picture. The Aussie rapeseed FOB export price traded down 12% MoM ending at $647/mt towards the middle of March. The Canadian canola export FOB was also going for $599/mt on the 15th of March down 10% MoM.
Similarly, the EU (Moselle) rapeseed FOB export price also lost 14% MoM to $508/mt. In Ukraine, export price FOB in the same period sold at $495/mt, down 9% MoM. Similar price trends have been established in other oilseeds markets, so going into April, the oilseeds may keep steady to lower, looking for some sort of bullish factor to buck the trend.