W22: Canola & Rapeseed Update

In W22 in the canola landscape, the European Commission increased its projections for rapeseed production by 0.2MMT to 20.2MMT, which is 3.6% more than 19.5MMT from the 2022 harvest and 17.2% more than the average 5-year indicator. After placing restrictions on rapeseed, wheat, maize, and sunflower from Ukraine on May 2, the EU Council approved a new regulation to continue the duty-free import of agricultural products from Ukraine for an extra year. Even so, the Ukrainian authorities insist that the restriction be removed and not extended beyond June 5. However, during the meeting in Brussels, the Ministers of Agriculture of Bulgaria, Poland, Hungary, Romania, and Slovakia requested that the EU extend restrictions on the import of Ukrainian grain and oil crops at least until the end of 2023. Prices for Ukrainian rapeseed are on the verge of collapse due to the fall in the price of biodiesel in the EU as well as the good harvest of oilseeds expected in the EU, which will lessen the European demand for Ukrainian rapeseed at the start of the harvesting campaign. The new rapeseed crop is now being contracted by forwarders in Germany at a price of USD 414.87-420.26/MT. Based on the large forecast supply of rapeseed in July in Ukraine, the price may decrease by USD 43.10-53.88/MT. On the Paris Stock Exchange on Thursday, June 1, the August rapeseed futures gained by 1.14% with a price of USD 430.77/MT and continued to rise by USD 7.27 to USD 438.04/MT on Friday, June 2.

The gross winter rapeseed harvest in Germany in 2023 is predicted to continue at the same level as last year at 4.28MMT and is planned to be harvested from 1.2M hectares. In April, expectations for rapeseed yield were lower, but projections climbed due to favourable weather and an increase in the planting area. In Saxony-Anhalt, Germany, the winter rapeseed area increased by 12.8% to 143,540 ha in 2023, compared to 127,269 ha in 2022. In FY 2023/24, Australia is predicted to produce 35% less rapeseed at 5.4MMT due to a decrease in the sowing area. In the Trans-Baikal Territory, Russia, rapeseed sowing is almost completed at 9.1K hectares (91.7% of the planned area). China’s 2023 summer harvest focuses on reaping winter wheat and rapeseed, starting from May to late June. Lastly, in the UK, for winter oilseed rape (OSR), for the week ending May 30, 63% of winter OSR was in good/excellent condition, compared to 70% in the same period the previous season. Damage from cabbage stem flea beetle (CSFB), pigeons, and rape stem weevils are the main causes of variability.