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Crushers looking to drive down prices

Date Added: 27/01/2017

By Owen Cligg, Trading Manager, United Oilseeds

 UK rapeseed prices have edged back this week as currency strengthened and UK crushers became more of a reseller than a buyer on the basis that crush margins were unable to cover their variable costs. Ex farm values are now £350 to £355 ex farm for spot with few buyers further forward. There is an inverse on rapeoil prices, meaning prices are lower in the forward positions so crushers do not want to own rapeseed past the spot position. We are therefore reliant on rapeoil demand remaining buoyant so that forward prices can rise to keep rapeseed prices at current or better levels.

 European rapeseed supplies are still tight and a high level of imports are still required to meet EU demand. On paper this should be possible with a better than expected Australian crop.  However, prices need to be at level to discourage any Australian shipments to China and also logistics need to run well to get supplies to destinations in a timely manner.

 New crop prices remain around £320 ex farm with few sellers looking to take advantage of historically high prices. UK and French plantings are down, but we are assuming a return to trend yields which should result in higher EU production.

 

Regards,

 

Owen

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