Market outlook for oilseeds and cereals: rapeseed prices rebound in Europe, cereal problems in the EU

According to CRM Agri, European rapeseed futures have now exceeded EUR 460/t and their 200-day moving average for November 2024.

Analysts are expecting an average rapeseed price in Paris of 470 EUR/t (520 M$) in Q3.

Read moreWhat can restaurant businesses do to help prevent diabetes?

According to an oilseed market specialist, this recovery is driven by two factors: the rise in vegetable oil markets and the increase in canola.

The vegetable oil market, crucial for oil-rich crops like canola, has seen a turnaround. Soybean oil prices, which had fallen due to increased soybean supplies and California's biodiesel plan, are now rebounding.

CRM Agri emphasizes that the expected surge in soybeans is still only speculation, depending on the harvests to be achieved in South America or the USA.

Other major oils such as sunflower and palm are also experiencing shortages. Indonesia, the world’s largest palm oil producer, reported that its stocks had fallen by 17 billion tonnes due to lower production. The tighter supply profile contributes to the forecast of a decline in global vegetable oil stocks by 2024/25. This will provide additional support for rapeseed prices.

Canola prices also recovered significantly, with Winnipeg futures up more than 7.1t from their three-year low. CRM Agri points out that this is partly due to the rebound in vegetable oil prices, but also to stronger-than-expected exports from Canada, driven by Chinese demand.

Analysts warn that Europe's high rapeseed crushing needs will require more imports to meet demand, especially as Ukrainian harvests are lower and Australian production is low.

Soybean Market

Soybean market prices have recovered slightly from their lowest levels in nearly four years.

CRM Agri continues to forecast a Chicago soybean price of 10.80 $/bu in the third quarter, citing the potential for a further recovery. The market remains cautious, with the huge US crop expected this year already priced in.

Markets remain optimistic despite weather conditions that could threaten harvests as we approach mid-September.

According to CRM Agri, South American soybean crops have yet to be planted and may require more price incentives to keep farmers moving.

Challenges of EU cereal production

The European Commission published its monthly MARS report on Monday on the development of harvests in EU Member States and other neighbouring countries. The outlook is poor for the total cereal harvest, with an estimated yield of 5.36 t/a – 0.12 t/ha below the five-year average.

EU officials have cut yield estimates for soft wheat (winter, spring and summer), barley and maize. Harvesting is still underway in Europe. Winter crops have been revised downwards due to excessively wet conditions in Western and Northern Europe and dry weather in Eastern Europe. AHDB Analysis.

The Baltic States experienced heavy rains this summer, which caused grain to lodge and impacted quality. In north-western Europe, rains continued and disrupted the harvest. This puts additional pressure on crop quality.

In southern and eastern Europe, warm weather and lack of water in July and August led to a downward revision for corn.

EU cereal imports

AHDB reports that the EU is importing more cereals due to lower production in many EU countries.

Imports of corn, soft wheat and barley are higher in 2024/25 compared to the average imports of the last three years.