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Rapeseed markets improve on bullish news

Date Added: 05/06/2015

By Owen Cligg, Trading Manager, United Oilseeds

Rapeseed prices improved this week as a raft of bullish news helped change market sentiment. Old crop supplies are now virtually exhausted, whilst new crop is now well bid at £250 ex farm for harvest in most areas.

An unexpected “black frost” in Canada would seem to be main reason for the rise. The combination of freezing temperatures and dry weather has decimated areas in Manitoba and Saskatchewan. It is estimated that 5 to 10% of canola acres could be affected and not everything will be reseeded. Also supportive is news from the US is that biodiesel mandates have been retrospectively confirmed for 2014 and 2015  which improved soy oil prices. In addition palm oil prices are also rising partly because of concerns regarding the dry el nino conditions developing the South East Asia.

Short term prices appear supported, but the spectre of increased soybean stocks may yet prove bearish in the long run.

Regards,

Owen

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