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Brazilian woes keep prices under pressure

Date Added: 19/05/2017

By Owen Cligg, Trading Manager, United Oilseeds

The main talking point this week has been collapse of the Brazilian Real which lost 7 - 8% of its value on Thursday after corruption allegations were made against the President. This made Brazilian soya much more competitive on the world markets and caused soya and rapeseed futures to drop. June oilseed rape is now valued at £320.00 ex farm, whilst harvest oilseed rape is £290 to £295 ex farm.

Old crop oilseed rape remains a standoff between the crusher, who cannot afford to buy because of poor crush margins, and farmer sellers who are still waiting for a last rally in the market.

New crop also remains thinly traded as although welcome rains should ensure reasonable yields, a price of below £300 ex farm does not get growers excited enough yet to sell. Yield forecasts for the EU are very diverse with total production estimated anywhere between 20.5 and 22.5 million tonnes. Whilst the  EU will rely on imports, the extent of the tonnage required will be a major determinant in future price direction.

Regards,

Owen

 

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