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Argentinian soya crop in trouble

Date Added: 23/02/2018

TRADER'S VIEW: By Owen Cligg, Trading Manager, United Oilseeds

Prices of soyabeans have risen as hot and dry conditions continue in Argentina. Latest estimates could put the Argentinian crop at less than 45 million tonnes, which will be around 10 million lower than last harvest. The supply of Argentinian soyabeans is particularly important as they are major exporters of soymeal and soyoil, so any supply disruptions can have a significant impact on world trade flows.

This is especially so concerning soyameal and we have already seen rapemeal prices rise from around £150/tonne to £190/tonne since November. Unfortunately rapeoil prices have been falling as biodiesel demand has been quiet since Christmas. This means that the rise in soya is not necessarily mirrored in rapeseed prices due to the higher oil content of rapeseed.

Currently English rapeseed prices remain around £290 to £295 ex farm with most sellers still holding out for higher prices. In theory, we still have plenty of exports of rapeseed to make from the UK but buyers continue to be reticent and are hoping for prices to fall.

On the positive side, the recent cold weather is likely to continue in to next week and temperatures below -15 degrees centigrade in continental Europe could lead to winter kill and a spike in rapeseed prices for new crop. Harvest rapeseed is valued at around £285 to £290 ex farm, so any improvement should have the effect of pulling old crop prices up as well.

We're Supporting British Farmers & Farming - Visit United Oilseeds at the Cereals Exhibition on stand 424, 13-14 June, Chrishall Grange, Duxford.

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