Despite sustained strong inventories and the impending harvest period in the northern hemisphere, the Euronext (MATIF) and ICE Canola futures revealed little price movement this week, signalling a cautious but steady tone among market participants. Physical markets are similarly stable, with FOB French-origin and Ukrainian-origin prices unchanged from the previous week.

The absence of significant price drivers, along with neutral speculative positions and generally favourable weather conditions, has contributed to this subdued market environment. However, attention remains on yield prospects in the EU and Black Sea regions, where above-average temperatures and precipitation variability could impact final harvest outcomes.

Global production estimates, trade flows, and the evolution of biofuel demand remain the key factors shaping sentiment. Forward-looking participants are advised to monitor weather updates, global policy shifts in biodiesel mandates, and developments in Australian and Canadian sowing conditions, as these may crystallise into clear direction for prices in the coming weeks.

📈 Prices

🌍 Supply & Demand Drivers

• Harvest pace: EU and Ukraine crops are approaching harvest; yield potential remains above the 5-year average, barring adverse late-season weather.
• Inventories: Global rapeseed and canola stocks remain comfortable, especially in the EU and Canada.
• Biofuel demand: EU domestic crush demand appears stable, but expectations for global biodiesel growth could stimulate demand in Q3/Q4.
• Spec. positioning: Managed money in Euronext rapeseed futures remains neutral, reflecting a wait-and-see approach.

📊 Fundamentals

• USDA & EU balance sheets: Current projections indicate robust 2025/26 carryover; latest USDA and Strategie Grains data support the view of healthy global supplies.
• Global production:
  • EU: ~19.2 Mt (slightly higher YoY)
  • Ukraine: ~4 Mt (steady, but Black Sea logistics to be watched)
  • Canada (Canola): ~18.5 Mt (potential for downward revision if dry weather persists)
  • Australia: Sowing nearly complete, eyes on post-dormancy moisture
• Stocks-to-use: Historically comfortable, with EU and Canadian carryover implying minimal supply stress for now.

⛅ Weather & Crop Outlook

• EU (France, Germany, Poland): Rain helped crops, but hot spells forecasted for mid-June could challenge final seed filling.
• Ukraine: Mixed precipitation, locally beneficial, but variability adds mild downside risk to yield projections.
• Canada: Prairies drier than normal -- monitor closely for further declines, as this would tighten global canola availability.
• Australia: Early sowing conditions are favourable; uncertain El Niño/La Niña developments are worth watching during winter dormancy.

🌐 Global Market Snapshot

📝 Trading Outlook & Recommendations

• Farmers: Consider forward selling a portion (10-20%) of the upcoming crop as a hedge before harvest pressure.
• Crushers & end-users: Take advantage of current offers for nearby delivery if margin structures are supportive; monitor global weather for longer positions.
• Traders/speculators: Positioning neutral at present—wait for harvest headlines or Canadian crop insurance data for clearer cues.
• Watch for: EU weather in June, Canadian drought indicators, and global policy signals in biofuel mandates.

📆 3-Day Price Forecast

• Euronext MATIF (Aug 25): EUR 470-478/t (neutral, harvest pressure vs. uncertain weather)
• ICE Canola (Jul 25): CAD 705-720/t (drifting slightly low as Canada weather weighs)
• French physical (FOB Paris): EUR 0.53-0.54/kg (stable, minor downside risk if EU weather turns hot/dry)