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Matif prices higher but Sterling slow to follow

Date Added: 27/02/2015

By Owen Cligg, Trading Manager, United Oilseeds

Matif rapeseed futures have shown good gains this week, with the May contract over 365.00 euros. However with sterling at 1.378 euros, most of the gains are mitigated by the stronger currency. Prices to Liverpool and Erith are at over £260 delivered which still only calculates to around £250 ex farm within most English production areas.

Soybean prices have found support from an ongoing truckers strike in Brazil. Not only is this affecting deliveries of soybeans but also deliveries of diesel to growers. This could have serious implications for the timely harvest of some soybeans, although it is estimated that Brazil is already about 60% through harvest.

Some support for rapeseed is also coming from the unwinding of soymeal and soyoil spreads meaning vegetable oil prices are improving. There is also a consensus that rapeseed imports in to EU will need to dramatically increase from harvest 2015 onwards, of which there may only be limited supplies from the Ukraine. Countering this are the latest EU biofuel proposals which may eventually reduce mandated use from 7% to 6%, however this still needs to be ratified by the Council of Ministers.

As United Oilseeds, we view the potential reduction of biodiesel production very seriously. To this end we are actively progressing new markets for both HOLL and HEAR production. We currently have a limited area available for HOLL contracts for 2016 harvest. Contact your local United Oilseeds Area Manager for details.



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