W25: Canola & Rapeseed Update

In W25 in the canola landscape, the canola market saw a decline in rapeseed prices throughout the week. On Monday, June 19, the price on the Paris stock exchange dropped to USD 509.94/mt, followed by a further decrease to USD 509.40/mt on Tuesday, June 20. The downward trend continued, with prices falling for five consecutive days, reaching USD 468.37/mt on Friday, June 23. Weaker crude oil prices and lower harvest forecasts contributed to the price decline. Canola futures on ICE followed a similar trend, decreasing from USD 745.6/mt on Monday, June 19, to USD 734/mt on Friday, June 23.

In the 2022/23 season, the EU imported 7.16 million mt of rapeseed. The majority of imports came from Australia, accounting for 48.6% (3.477 million mt), followed by Ukraine at 41.4% (2.96 million mt), and Canada at only 3.2% (230 thousand mt), a significant decline from 2022's 611,000 mt. In France an improvement in winter rapeseed production is anticipated with an estimated production volume of 4.6 million mt, representing a 2.6% increase compared to 2022 and an 18.1% increase compared to the average of the last five years. However, in Germany, drought stress has led the German cooperative association DRV to lower its harvest estimate for grain and rapeseed. The association now expects 4.1 million mt of rapeseed, which is 200 thousand mt less than the previous month's estimate. MARS, in its mid-June report, revised the estimated 2023 rapeseed crop in Ukraine to reach 5.47 million mt, a significant increase from the April forecast of 3.04 million mt. This anticipated harvest would be 99% higher than the five-year average of 2.75 million mt, primarily due to expanded rapeseed cultivation. The increase in rapeseed production is attributed to the expansion of rapeseed cultivation.

Recent rainfall in Western Australia has had a positive impact on grain crops that were previously under moisture stress. The crops have undergone positive transformations as a result. Additionally, a significant area of land, amounting to 1.8 million hectares, has been utilised for planting canola. Nevertheless, rapeseed production in Australia for the 2023/24 season is expected to decrease by 41% to reach 4.9 million mt due to drought conditions, marking an end to three consecutive record harvests. In Canada, canola cultivation in Alberta covers only 30–40% of the fields, while Saskatchewan has 100% fully planted fields. Although canola in Alberta is facing challenges and many varieties are experiencing delayed development of two to three weeks, there is still some hope for the crop to recover early in the season. Lastly, in Edirne, Turkey, adverse weather conditions including hail and heavy rainfall have caused significant damage to approximately 16 thousand decares of cultivated area in 11 villages, affecting wheat, barley, canola, sunflower, and corn crops, with damage ranging between 30-80%.