Rap prices soaring - why and for how long? The rapeseed prices on the Paris stock exchange have risen from 375 to over 550 € / t since the beginning of the year. The producer prices are only slightly behind this development. In Canada, the price increases to 600 € / t were even greater. Why does this development, which has been unusual for years, take place in a relatively short time?
- The supply situation with rapeseed has become extremely scarce worldwide. In the most important cultivation areas Canada and EU-27 with a production share of more than 55%, the harvests were significantly reduced. In the EU, the earlier results have dropped from around 19.5 million t to 16.5 million t. In Canada, as a result of the latest heat wave, only 16 mln t will be harvested this year instead of the expected 20 mln t.
- World trade: The supply situation is exacerbated by the fact that Canada, as the largest export area with the usual 60% export share, has to reduce its imports by half and at the same time the EU, as an importer with 35% import share in world trade, would have to increase its imports.
- Rapeseed or rapeseed oil is in close competition with the market leader palm oil in the oilseed market. The palm oil prices have risen from 600 to over 950 € / t due to poor harvests as a result of the weather and corona-related failures of the workforce.
- The price for soy - as another world-leading supplier of vegetable oils - has also risen from 350 to 550 € / t in the same period.
- Rapeseed, palm and soybean oil form a considerable part of the raw material basis for the production of biofuels , the prices of which are closely based on mineral fuels made from crude oil.The price of crude oil has doubled since mid-2020 from $ 35 per barrel to today's $ 70.
Overall, this market situation forms the basis for the rape pricing, wherein rapeseed is in principle with a nearly 15% production share of the total market in the oilseeds Anpasserrolle. In the current phase, however, the rapeseed supply is particularly pronounced compared to the other products. What's next? (1) The price of crude oil provides a basic orientation. A foreseeable improvement in the global economy will keep future energy prices at a comparatively high level. (2) Palm oil production in Malaysia is stagnating and is only growing by around 1% in Indonesia. Biodiesel is increasingly being produced from palm oil in both countries. The inventories are at an all-time low. A significant increase in the supply volume is not to be expected.(3.1) The increased soy prices are an incentive to increase cultivation. In South America, with a focus on Brazil, this will be in the coming October / Nov sowing months. already expected. However, China's increasing import demand is likely to take up a considerable part of the additional production. The weather-related production risk remains high. (3.2) The same applies to US soybean cultivation from May 2022. (4.1) Rapeseed cultivation in the EU-27 will increase as a result of the high price incentives. In order to achieve the earlier average production of 19.3 million t, the area would have to be increased by 0.8 million ha or 15% with average yields of around 31 dt / ha. If consumption remains unchanged, there is still an import requirement of around 3 million t. (4.2) Assuming that the catastrophic weather conditions do not repeat themselves, Canadian rapeseed production could again reach an average level of around 20 million t in 2022.(4.3) Under the aforementioned conditions, global rapeseed stocks in 2022 will still remain around 20% below previous multi-year averages. The supply remains below average. Rapeseed prices around € 470 / t are traded on the Paris stock exchange for August 2022. In Canada , the new harvest in 2022 is estimated at around € 450 / t .
