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Traders view

Date Added: 24/02/2012

Currency supports oilseed rape prices

 

This week has shown further gains in oilseed rape prices as sterling has fallen to be below 1.18 against the euro. £370.00 ex farm is possible for old crop whilst £350.00 ex is well bid for harvest movement.

 

Rather than a weakening of sterling, currency seems to be more focused on a strengthening of the euro as the Greek situation in theory is getting resolved. However we believe the situation to be very fickle and there will be more unexpected movements ahead.

 

As regards the fundamentals of the oilseed rape market there is support from a strengthening crude oil price, whilst continuing uncertainty over the size of the South American soya crop is adding some risk premium to the price.

 

Crushers are still complaining about crush margins and an early spring could put a different perception on things. Also most commentators are talking about big crops of corn, wheat and canola next year which could bring back prices in the longer term.

 

Regards,

 

Owen

 

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