Oilseed rape prices could see improvement in the coming months, despite winter planting figures revealing an exit from the crop.
AHDB’s winter planting figures for December last year showed English OSR areas had declined 10 per cent, while Scottish areas were down 18 per cent compared to the previous year. There were also declines in the total UK area of winter crops.
James Bolesworth, director at CRM AgriCommodities, said this would be down to a combination of restrictions on crop protection products, such as neonicotinoids, as well as low prices.
These claims were underlined by Helen Plant, senior analyst for cereals and oilseeds at AHDB.
But Mr Bolesworth said price improvements were more likely for OSR than for cereals crops.
He said: “We are already seeing a good rally in prices at the moment.
“There is probably more hope on the rape market than on cereals for price.”
Mr Bolesworth said despite the decline in area, large numbers of farmers had kept their OSR areas.
“With lower area and consumption remaining strong, they may feel prices could increase,” he said.
Mr Bolesworth suggested OSR was also being aided by improvements in palm oil and other crops.
He said: “OSR is in the region of £265/tonne ex-farm, which is a marked improvement from where it was.”
Prices of OSR rallied through March. May 16 MATIF rapeseed futures were trading at €368.25/t (£288.82/t) on Tuesday afternoon (March 29), compared to €343.50/t (£269.45/t) on March 2.
Wheat prices have remained under pressure since the start of the year, but have also seen some small prices increases in the past week.
Since New Year, prices fell from about £114/t for nearby LIFFE futures to less than £100/t at the start of March, but they have since risen to about £106/t on Tuesday afternoon (March 29).
Mr Bolesworth said it was important for farmers to take advantage of short-term rallies in price.
“There are short-term rallies which present selling opportunities. Other than that, structural change to fundamentals is needed if we are going to offset the balance in supply and demand.”
AHDB’s winter planting survey showed a 3 per cent decline in English winter cropping areas.