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Sunflower seed could cap oilseed rape prices
With supplies of oilseed rape tight in the UK and Europe this season, imports will play a major role in the market.
Alex Black
And while sunflowerseeds represent a comparatively small part of the oilseed complex, AHDB highlighted a growing crop could add pressure.
AHDB senior analyst James Webster said the EU market was likely to be dominated by imported rapeseed/canola from Australia and Canada, as well as imports of other oilseeds.
But EU imports had been slow this season.
“One reason for this sluggish start to imports is substitution,” he said.
“Soyabean imports in the first six weeks of the marketing year are up 9 per cent at 1.74mt, meanwhile imports of sunflowerseeds are up 104 per cent, albeit at just 33,000t.”
He added this could cap price potential with sun oil and soya oil trading at a discount.
“The discount of sun oil to rapeseed oil is standing at $115/t, similar to levels seen in early 2020,” said Mr Webster.
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Sunflowerseed oil imports were up 355,000t year-on-year in the second half of 2019/20.
Ukraine was expected to harvest a record crop in 2020/21 according to USDA, with Russia headed for its second largest crop.
Attractive
Mr Webster said while it was a small part of the oilseed complex, the crop looked increasingly attractive.
US and China trade talks have put a lid on soyabean prices, with the US critical of how China has handled the Covid-19 crisis in Hong Kong, according to David Woodland, trading support analyst at ADM Agriculture.
There were concerns a lack of rain in the Midwest and recent storms could lead to USDA reducing the soyabean area and production.
“A favourable weather outlook is still providing the potential for large Australian and Canadian canola crops this season,” Mr Woodland said.
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