Scarce supply of rapeseed drives rapeseed meal prices

In Germany, UFOP reports that prospects of a tight rapeseed supply to the market both in the current and upcoming marketing year led to a sharp rise in prices in the run-up to Christmas – not only in the case of the oilseeds, but also of by-products.

Oilseed meal prices had surged sharply since November. The reason was reduced rapeseed crushing activity at the oil mills and the resulting shortage in rapeseed meal. This scarcity drove prices, especially because demand perked up for just a short time before Christmas. In addition, rapeseed meal prices on the German cash market received support from futures prices in Paris. Above all, the forecast of tight rapeseed supply to the market sent prices rocketing.

This trend was also reflected in selling prices for rapeseed meal. According to Agrarmarkt Informations-Gesellschaft mbH (AMI), mid-December selling prices ex German oil mill amounted to EUR 212 per tonne, up EUR 24 per tonne from mid November. This translates to the equivalent of EUR 6.06 per protein percentage per tonne of rapeseed meal in December compared to EUR 5.37 a month earlier. In other words, rapeseed meal lost some of its competitive advantage against soybean meal compared to the previous half year. Nevertheless, the price difference of EUR 2.56 per percentage per tonne remained above average. A year earlier, the price curves for protein were only EUR 1.50 apart.

The Union zur Förderung von Oel- und Proteinpflanzen (UFOP) expects supply to be similarly tight in the coming year unless the pre-contract prices offered at the time of sowing incentivise rapeseed growers to expand their rapeseed areas. The association has explained that oil mills are caught in the dilemma that the moderation of prices will lead to a shortage in the foreseeable future and result in the necessity to import rapeseed for a better utilisation of processing capacities.