Jonathan Lane, Gleadell’s trading director, comments on the OSR market

After achieving contract highs on the May17 MATIF contract last week, the now front-month contract took a breather with a €15 pullback. This was matched by a decline in sterling, initially protecting UK prices against most of the futures-led decline.

This week’s Commons vote to allow Theresa May to begin the Brexit process has had little effect on sterling, which has seen volatile conditions as the Bank of England inflation and growth forecasts are digested. This, combined with the decline in MATIF, means ex-farm OSR prices now stand £12/t lower than a week ago.

Weather worries in South America that supported soybean futures have now been partially discounted. The market reacting negatively, which was then mirrored in the MATIF contract. With Australian oilseed rape cargoes a week closer to European shores, and UK crushers not in the market due to poor crush margins, UK OSR prices may feel more pressure as trade shorts reduce bids against perceived crop tightness.