Rapeseed and Soybean Prices Climb Amid Geopolitical Tensions

November 18, 2024 – Rapeseed and soybean prices saw significant gains on Monday, fueled by escalating geopolitical tensions and rising crude oil prices. Weakness in the palm oil market had a limited impact on this upward trend.

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Price Developments

• Euronext Rapeseed Prices:
  • February Contract: +€3.75 to €543/t (new all-time high).
  • 2025 Harvest: Slight declines, mixed performance for long-term futures.
• CBOT Soybean Prices:
  • January Contract: +11.25 cents to 1,009.75 cents/bu.
• Palm Oil Futures (Malaysia):
  • Monday: -3%, showing recovery on Tuesday morning.

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Market Drivers: Geopolitics and Export Demand

The fear of further escalation in the Russia-Ukraine conflict boosted oilseed markets. Technical buying on the CBOT also contributed to the gains, particularly after the January soybean contract broke above its 20-day moving average.

Export demand added further support:

• Export Sales:
  • 261,000 tons of soybeans to Mexico.
  • 135,000 tons of soybean meal to the Philippines.
  • 30,000 tons of soybean oil to an undisclosed destination.

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Export Data Highlights

The weekly export inspection report for the week ending November 14 reported:

• Total Soybean Exports: 2.165 million tons
  • Compared to the previous week: -8%.
  • Compared to 2023: +33%.
• Top Destinations:
  • China: 1.39 million tons.
  • Germany: 143,343 tons.
  • Mexico: 100,786 tons.

Year-to-date soybean exports have reached 17.5 million tons, up 9% from the same period last year. This marks the second-largest total for the first 11 weeks of a season in seven years.

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Progress in Brazilian Soybean Planting

Soybean planting in Brazil for the 2024/25 season continues to advance:

• Planting Progress:
  • 80% of the expected area has been sown (previous week: 67%, last year: 68%).
• Regional Developments:
  • Advancements in Rio Grande do Sul and Matopiba, where planting typically starts later.
• Weather Challenges:
  • Reduced rainfall in southern regions and parts of Mato Grosso do Sul has raised concerns among farmers.
  • AgRural noted that it is still too early to project any yield losses.

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Outlook

Oilseed markets are expected to remain supported in the near term by geopolitical tensions and strong export demand. Key factors to watch include weather developments in Brazil and the stability of global supply routes.