Canadian rapeseed crop estimates have been lowered following a record heatwave at the end of June which saw temperatures reach just below 500C and dozens of deaths.
In its most recent estimate, the United States Department of Agriculture (USDA) lowered its yield forecast to 22.4 decitonnes/ha – a level below the long-term average, according to a 21 July report by the Union for the Promotion of Oil and Protein Plants (UFOP).
As a result, the country’s potential output was also reduced to 20.2M tonnes.
Prices rose as a result, with Winnipeg canola futures reaching a record high at the equivalent of just less than €661/tonne on 13 July. An exceptional increase had already been recorded in the days before, with the largest possible gain in one trading day having been reached.
"In other words, rapeseed rose around €100/tonne in Canada in a single week," UFOP said.
The surge in prices was unlikely to affect demand, according to the UFOP report, with the EU alone needing 0.15M additional tonnes of rapeseed from overseas due to its own inadequate supply, the report said.
While Canada’s stocks from 2019/20 had amounted to just over 3M tonnes the previous year, the country’s storage facilities were depleted at 1.2M tonnes prior to the 2021 harvest, according to UFOP.
“Even if the harvest were to reach the estimated volume of just over 20M tonnes, exceeding the previous year’s output by 1M tonnes, total supply would slide to a level 740,000 tonnes below the previous year’s figure and 1.5M tonnes below the five-year average,” the report said.
This situation would limit rapeseed supply on a global scale and stabilise producer prices at the current appealing level, according to UFOP.