Willie Wright, Oilseed Trader at Gleadell, offers insight into the global oilseed market, where rapeseed prices have slipped from recent highs, though there may still be cause for optimism.  

Soybeans touched $15.15 in the July contract earlier in the week, this new high appeared to be enough for some traders with sellers keen to book some profits. The market continues to be well supported with continued crop reductions and increased demand for soybeans coming from China. The weekly export sales figures for US soybeans came in at 1.4mln t split between old and new crop, much higher than the market had anticipated and, with South American production reducing, buyers are now tapping into the US market.

Rapeseed prices slipped from their recent highs and more dramatically on old crop with May MATIF futures dropping €14 on expiry. May MATIF had been trading at a €15-€20 premium over the August contract but expired on Monday at a €4 premium causing a little confusion about some old crop values. The unknown in the old crop rapeseed market is the reduction in crush demand throughout Europe due to extremely poor crush margins, some feel that this figure could be higher than is currently being reported and could help increase end season stock figures in Europe. Old crop market prices will remain volatile in the short term which is not being helped by Sterling’s strength against the Euro. We are still seeing good buying interest, although the resolve of the sellers looking for £400 ex farm may be tested for a few weeks more!

New crop rapeseed prices have tracked old crop higher and, with oil world and other analysts reducing the size of the European rapeseed crop to 18.3mln t, which is the lowest level for 6 years, we expect to see the market supported for the time being. We have also seen reports of China looking to increase rapeseed imports to 2mln t from the previous year, a 70% increase year on year.