UK rapeseed prices are still on the defensive, valued at £305 to £310 ex farm in England and £295 to £300 ex farm in Scotland.
May Matif rapeseed futures recovered from recent lows of below 340 euros to just over 350 euros, however, those gains are mitigated by a stronger currency as the £ has recently strengthened to 1.116 euros.
From only a month ago when rapeseed stocks were viewed as insufficient, market perception has now changed to a view that stocks will need to be carried over to next season. Demand for transport fuel is now obviously lower as the coronavirus lockdown affects most of Europe. This translates into less biodiesel demand and hence reduced crushing.
Rumour has it that some Canadian canola imports are being washed out as the GM oil can only be used for biodiesel. This hopefully stops EU stocks increasing at too high a level and may yet give a chance for old crop prices to improve.
Prices of rapemeal are increasing as rapeseed crush decreases and soymeal supply is also in question. This will at least help rapeseed crush margins and allow crushers to continue to operate.
Soya supplies in South America are in question due to a mixture of lower yields and logistical issues due to the coronavirus. However, low
corn prices in the US may well encourage higher soya plantings in the coming spring.New prices remain well bid as this year's historically low rapeseed area is supportive. If demand returns, we can hope for better prices to come.
Regards,
Owen
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