UK rapeseed prices have risen recently, buoyed by a strong world oilseeds market and the reopening of one of the country’s biggest crushing plants after a long shutdown. But uncertainty, with no deal yet between the UK and EU over the trading relationship after January 1st, has added to the mix, with the potential for currency volatility and confusion over 2021 trading conditions.
“The market’s fairly good as far as prices are concerned,” David Whyte, trader at United Oilseeds, told Agritrade News. “There are imports coming into both Liverpool and Erith.
“ADM’s Erith plant has opened up now for the first time this week after the fire in June. It is still running, so that’s good news.
“Apart from that it’s all business as usual,” Mr Whyte continued. “Soyabean prices have been holding things up with the vegoil. South American weather’s been having a bit of an effect on things. It has all been conspiring just to support the market, but how much of an upside there is will depend where the import parity really strikes – whether crushers stop buying off farm because they can import seed cheaper.
“At the same time, the UK does need to import quite a lot anyway,” he pointed out. “As does Europe.
“Then of course we are creeping close to the end of December, so everybody is looking over their shoulder trying to second guess what is going to happen then,” Mr Whyte added. “Sterling has a major effect, depending on which way we bounce. You could argue that the better prices are being had now – maybe post-Christmas we’ll see the market just sort of bumble along at the same levels or maybe drift away slightly.”
AHDB reported on Monday that last week’s USDA World Agricultural Supply and Demand Estimates (WASDE) report cut 2.7 million tonnes from 2020/21 US soybean production, bringing it to 113.5m tonnes, due to lower yields. “The report also cut 2.5m tonnes from Argentina’s soybean production, owing to reduced area expansion in light of economic uncertainty,” it added.
The Board noted Brazil’s Conab reporting an expansion in soya plantings there. “This is expected to be off of the back of firmer soybean prices due to a tighter world outlook,” it said. “Rainfall in South America has aided planting progress in some states. However, ongoing dryness and the impacts of this year’s La Niña are being felt, with weather remaining a key watch point for crop development.
“Chinese buying of oilseeds remains a key component of the recent soybean price rises. In the latest USDA export sales data, net sales of 746,000 tonnes of soybeans to China were reported, with total outstanding sales to all destinations now standing at 30.1m tonnes,” the AHDB added.
“Certainly, we’re seeing the Chinese are vociferous buyers of soyabeans,” David Whyte commented. “Anything they can get their hands on they seem to be buying at the moment.”