Rapeseed output in the European Union, the world’s largest producer of the oilseed used in cooking and biofuels, may increase to a four-year high after German farmers planted more crops, reported Bloomberg.
Total European production may rise to 20.96 million metric tonnes in 2013-14, up 8.8% from a year earlier, Brussels- based farm lobby Copa-Cogeca said in provisional estimates released December 14th. That would be the largest crop since the 2009-10 season, EU data show. The rapeseed harvest in Germany, second-biggest grower in the 27-nation bloc, may climb 15% to 5.54 million tonnes, the country’s oilseed-industry association said in an e-mail December 10th.
Rapeseed futures on NYSE Liffe in Paris advanced 6.3% this year, rising to a record in July, as drought in the US crimped supplies of soybeans, an alternative oilseed. This season, the EU’s rapeseed harvest was little changed at 19.2 million tonnes, according to the European Commission, the bloc’s administrative arm. EU farmers begin sowing rapeseed in August, and plants go dormant over winter before harvest starts in June.
“The price was very attractive at the sowing time,” said Dieter Bockey, head of biofuels and renewable resources at Berlin-based industry group Union zur Foerderung von Oel- und Proteinpflanzen or UFOP. Germany had “the best sowing conditions in years.”
Rapeseed trailed soybean’s 23% gain this year on the Chicago Board of Trade and a 12% rise in ICE Futures Winnipeg’s contract for canola, a variety of rapeseed. Soybeans climbed to a record $17.89 a bushel in September and corn climbed to an all-time high of $8.49 a bushel in August. The Standard & Poor’s GSCI Agriculture gauge of eight commodities advanced 7.4 % this year.
The EU is the world’s largest producer, consumer and importer of rapeseed, according to the US Department of Agriculture. The oilseed is the bloc’s fourth-largest arable crop, after wheat, barley and corn. In the 2013-14 season, rapeseed may be grown on 6.81 million hectares (16.8 million acres) in the EU, up from 6.48 million hectares in the previous season, according to Copa-Cogeca.
The area devoted to rapeseed in the EU may climb by as much as 500,000 hectares as Germany had its first planting season in three years without excess rain, and farms in Poland seeded more of the crop, Oliver Balkhausen, deputy head of economics at trader Alfred C. Toepfer International GmbH, said on the sidelines of an oilseed meeting last month.
Hamburg-based researcher Oil World said last month it expects Germany’s crop area to jump 12% to 1.45 million hectares while French planting declines 3.4% to 1.55 million hectares. Poland may boost seeding by 18% to 800,000 hectares, supplanting the UK with the EU’s third- largest rapeseed area, Oil World said. The researcher will release its next weekly supply and demand report today.
In Germany, crop conditions are currently “very good,” Bockey of the UFOP in Berlin said. The group’s production forecast is contingent on the expectation that winter temperatures won’t drop low enough to damage crops. Germany’s rapeseed production in the previous season was 4.82 million tonnes, according to the Federal Statistics Office.
The winter-crop area in France, EU’s largest rapeseed producer, may drop 9.4% to 1.45 million hectares, because drought in August and September discouraged farmers from planting, according to Paris-based researcher Cetiom.
As much as 20% of rapeseed crops in the UK may be at risk of failure after excess rain fell from September to November and fields were infested with slugs, according to the Agriculture & Horticulture Development Board. Devizes, UK based marketing company United Oilseeds estimates that 114,000 hectares will have to be replanted in the spring, or about 15% of the country’s crop.
“Crops have struggled,” said Owen Cligg, the trading manager at United Oilseeds, which a handles 20% of the UK’s rapeseed crop. “They’re still quite small and not very well-established, so we’re expecting a certain percentage of those not to come through the winter. Some already have been plowed up to be planted with something else.”