W41: Canola & Rapeseed Update
In W41 in the canola landscape, Nov-23 futures on the Paris Stock Exchange remained stable at USD 451.80 per metric ton (mt) on October 9. However, on Tuesday, October 10, rapeseed prices experienced a 6.6% week-on-week (WoW) decline to USD 444.91/mt due to pressure from the oil sector. The drop in soybean prices on the Chicago Stock Exchange further added to the downward pressure on prices, which had been falling over the past month. On Wednesday, October 11, rapeseed prices saw mixed movements mid-session, increasing to USD 446.50/mt. However, on Thursday, October 12, rapeseed futures fell to USD 430.34/mt during the mid-session despite a recovery in the rest of the oilseed complex. On Friday, October 13, rapeseed futures increased by USD 10.07/mt to USD 449.94/mt, with the latest United States Department of Agriculture (USDA) report and rising palm oil and crude oil prices contributing to the price boost. The USDA had reduced its estimate of the American soybean harvest for the year by 1.1 million metric tons (mmt) to 112 mmt.
The USDA lowered its global oilseed production forecast for the 2023/2024 season by 200 thousand mt, bringing it to 538.5 mmt. This reduction is primarily due to lower soybean and peanut production in India and reduced canola production in Canada. However, it is partially offset by higher rapeseed production in Poland and increased sunflower production in Argentina. In 2023, the European Union (EU) plus the United Kingdom (UK) is expected to produce 20.4 mmt of rapeseed, down from the previous forecast of 21 mmt but higher than the 19.9 mmt produced in 2022. The UK's rapeseed harvest is estimated at 1.03 mmt, marking a 14% year-on-year (Yoy) decline.
In Aug-23, Australian canola exports decreased to 359 thousand mt, down from 424 thousand mt in Jul-23, but higher than the 152 thousand mt exported in Aug-23. The primary destinations for Australian canola in Aug-23 were Japan and the EU, receiving 130 thousand mt and 124 thousand mt, respectively. Since the start of the 2022/2023 marketing year (MY), cumulative exports reached 5.36 mmt, with 2.77 mmt shipped to the EU and 770 thousand mt to Japan. Notably, oilseed exports to Mexico significantly increased during this period, reaching 200 thousand mt, compared to 43 thousand mt from Jan-22 to Aug-22.
In Russia, the estimated rapeseed harvest in 2023 increased by 100 thousand mt to 4 mmt but is lower than the 4.5 mmt produced in 2022. However, there remains a risk of losses in the Siberian Federal District due to unfavorable weather conditions for harvesting. Meanwhile, Russia’s Ivanovo region reported a record rapeseed harvest of 5.2 thousand mt. This is a substantial increase, 3.7 times higher than the previous year. The area dedicated to rapeseed cultivation expanded by 2.7 times, from 879 hectares (ha) to more than 2.3 thousand ha.
In Ukraine, almost 3.7 million ha have been sown with winter crops, with a significant portion, 1.11 million ha, dedicated to winter rapeseed cultivation. The leading regions for winter rapeseed planting are Dnipropetrovsk, with 117.3 thousand ha, and Odesa, with 103.6 thousand ha.