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UK rape prices helped by weaker Sterling

Date Added: 21/07/2017

By Owen Cligg, Trading Manager, United Oilseeds

This week’s price action has been dominated by a weaker sterling which has reached an eight month low of £1 = €1.114 euros.  Remarks from ECB and frustration with the Brexit process have sent the pound lower with some analysts looking at pound euro parity.  This puts English ex farm oilseed rape prices in a range of £305 to £310 ex for harvest movement. Whilst sterling prices are steady, matif prices have fallen back as the euro has appreciated against the dollar and harvest results of European rapeseed generally remain favourable.  

This now puts European rapeseed at a narrow spread against Canadian and Australian supplies, which suggests that the spread will need to widen for the EU to attract imports and make up supply demand deficit.

Canola prices in Canada and Australia have been both appreciating due to drought and analysts continue to downgrade crop estimates. The drought in the northern US plains also shows no sign of ending and analysts are now beginning to downgrade corn crops in the mid-west. If it stays dry in to August, soybeans will likely become severely affected and we could see further price rises.
Looking at supply and demand of rapeseed in the UK, we are seeing very variable yield results. Some crops were impacted by flea beetle and drought so have yielded below 3 tonnes per hectare, whilst other crops have touched 5 tonnes per hectare. One such crop of Skye in East Anglia was particularly pleasing. Our production estimate now exceeds 2.0 million tonnes which will no doubt mean exports and imports of equal measure to keep supply demand in balance.
Please go to the following link to learn about Skye OSR from United Oilseeds to learn about the variety:


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