Weather hits oilseed supply, except sunflowers and soyabeans

According to the US Department of Agriculture (USDA), prices of all seeds and oils will stay high owing to a fall in oilseed production. Sunflowers and soyabeans are however expected to go against this trend. In Argentina (the world largest sunflowerseed producer) sunflowers planted area could increase by 16.6% in 2002-2003 and in Brazil (2nd world largest soya producer) soyabean crop to be planted should go up by 19%.

In Asia, the Chinese National Grain & Oil Information Centre announced China’s 2002-2003 soyabean production to be a record. Normally, a good soya crop should lead to lower rapeseedoil prices as well, but soyaoil has been weaker in Chicago last week and rapeseedoil has strengthened in Europe. This is not good news for the biodiesel industry which is struggling to produce at above variable cost recovery at present.