Rapeseed Gains for the Second Consecutive Day – Market Buoyed by Trade Developments

The rapeseed market in Paris extended its gains on Tuesday, following Monday’s positive trend. The May contract at Euronext increased by €3 to €522/t, while the August contract rose by €3.75 to €490.25/t. In Chicago, soybeans rallied strongly, with the March contract at CBoT closing up by 16.75 ct to 1,075 ct/bu. EU rapeseed also benefited from the stronger Canola trade on ICE, where the March contract climbed by 6.70 CAD to 647.20 CAD/t.

CBoT Soybeans Supported by Optimism on US-China Trade Relations

Market sentiment at the CBoT is improving, as traders grow hopeful that the trade conflicts initiated by US President Donald Trump may not severely impact the soybean market. Following the one-month suspension of import tariffs on Canada and Mexico, a potential resolution with China now seems possible.

• Trump had previously ordered a 10% tariff increase on all imports from China.
• China’s response was moderate, with agricultural commodities not being targeted in the initial countermeasures.
• A planned discussion between Trump and Chinese President Xi Jinping is fueling expectations that further tariff increases may be suspended for continued negotiations.

Canola Oil Shipments Continue to the US Biodiesel Industry

Following the preliminary agreement with Canada, shipments of Canadian Canola oil to the US biodiesel sector remain uninterrupted.

• This development contributed to the recent decline in CBoT soybean oil prices.
• For the European rapeseed market, this situation is supportive, as, without tariffs, the US remains the preferred destination for Canadian Canola producers.
• This reduces the likelihood of surplus Canadian supply being redirected to the EU, preventing downward pressure on European rapeseed prices.

Palm Oil Pulls Back After Five Consecutive Gains

• Malaysian palm oil futures ended a five-day winning streak on Tuesday, closing lower.
• Weaker soybean oil prices in Chicago contributed to this decline, with the downward momentum spreading to Southeast Asian vegetable oil markets.
• The Dalian Commodity Exchange in China remained closed for the Lunar New Year holiday but reopens today, which could introduce fresh volatility to global oilseed markets.

Outlook: Canola Strength Supports EU Rapeseed, Trade Talks in Focus

The EU rapeseed market is currently benefiting from firmer Canola prices in Canada and reduced trade tensions. However, uncertainty remains regarding US-China negotiations, as well as weather conditions affecting the ongoing South American soybean harvest.

This week’s developments in trade and weather will be key drivers for market direction in the coming days.

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