Small UK rapeseed crop could increase reliance on imported protein meal for feed market

Recent increases in coronavirus infection rates across the US, Asia and the EU have pressured global oilseed markets, according to AHDB analysts Alex Cooke and Charlie Reeve.

Many growers across the east of England expect to start harvests later this week or the beginning of next, dependant on weather. Oilworld forecast the UK rapeseed crop at 1.12Mt, marking potentially the lowest production figure in over twenty years.

“What this means for feed markets is perhaps a greater reliance on imported protein meal,” Cooke and Reeve explain. “Furthermore, the temporary closure of the Erith crushing plant could affect meal availability for surrounding feed manufacturers.

“With a decreased availability of domestic rapeseed, imports are likely to increase in volume to supply the deficit. As a result, UK rapeseed prices are more likely to price at import parity levels, with Ukraine and Australia likely origins.”

In addition, a forecast bumper US soyabean crop and increased Brazilian stocks could pressure soyameal prices, with a knock-on effect for UK soyameal imports that feature in protein feeds.

In June, global oilseed prices started strong, seeing rises over the first half of the month. This was largely due to two key factors, a significant increase in US soyabean export sales to China, coupled with the easing of lockdown measures in the EU and US. Fuel use will increase as more countries reduce lockdown measures, benefitting biodiesel markets and supporting oilseed prices.

The main price drivers will be changes in currency and prices trends in the wider global market.

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