W39: Canola & Rapeseed Update

In W39 in the canola landscape, the United States Department of Agriculture (USDA) predicts that global vegetable oil production in 2023/24 will reach 222.8 million metric tons (mmt), a 6.5 mmt increase compared to the previous year. Specifically, rapeseed oil production is expected to increase by 400 thousand metric tons (mt) to 33 mmt. Meanwhile, in the European Union (EU), the forecast for rapeseed production in 2023/24 has been slightly increased to 19.6 mmt, while the import forecast for oilseeds remains unchanged at 5.8 mmt.

Ukraine is implementing a verification procedure for four agricultural crops exported (wheat, rapeseed, corn, and sunflower) to five neighboring EU countries and will only export these products with their consent. The process includes issuing licenses within 30 days after receiving export applications and notifying the European Commission and the respective country's authorities upon receiving the application.

Additionally, Ukraine achieved a record rapeseed harvest of 4.2 mmt in 2023, despite bans from EU countries and the absence of a grain corridor. The sowing of winter crops continues in Ukraine, with 2,179 thousand hectares (ha) already sown, including 1,038 thousand ha of winter rapeseed. Dnipropetrovsk Oblast leads in crop sowing, with 111.9 thousand ha of rapeseed sown as of Sept-23. The export potential for rapeseed and its processed products is estimated to be at a record level.

Farmers in Krasnoyarsk, Russia, who produce rapeseed and soybeans, are set to receive USD 1.40 million in state funding to support the cultivation, including for export purposes. Over the past four years, the Krasnoyarsk region has been Russia's leading producer of rapeseed, with a harvest of 427.6 thousand mt in 2022. Additionally, agrarians near Moscow are concluding winter rapeseed sowing, covering almost 10 thousand hectares and yielding a gross harvest of 9.6 thousand mt.

In the 2022/23 marketing year, Germany increased its rapeseed oil exports by 19% to 1.3 mmt after a notable decline in the previous year. The Netherlands was the largest recipient, receiving 710,400 mt for global re-export, up from a 19% decrease in the previous season. Belgium ranked second with 110,800 mt, a 28% increase. Other destinations included Denmark, France, and Norway, with varying export levels. Norway saw the most significant growth, with exports more than doubling compared to the previous year.

China's rapeseed imports for the current agricultural year are estimated to reach 5.1 mmt, a significant increase from the earlier prediction of 2.5 mmt by the USDA. Canada shipped 4.71 mmt of canola to China in the 2022/23 crop year, up from 1.22 mmt the previous year. Having harvested a record 8.27 mmt of rapeseed in 2022, Australia was reducing prices to meet China's demand. High demand for vegetable oils also contributed to this trend, with canola's advantage being its high oil content compared to other crops like soybeans.