Ukrainian market of rapeseed - equator of the season-2013/14
During several recent seasons Ukraine continued keeping its status of one of the largest producers and exporters of rapeseed. According to estimations of the USDA, in 2013/14 MY the country will reach the 6th position in the world rating of rapeseed producers, and the 3rd position in the list of the oilseed suppliers on the world market, thus covering 3% of the global production, and 17% of the world exports of the oilseed.
Dynamics of production and domestic processing
For the first time after 4 years of the downward trend, in 2013 the production volumes of rapeseed in Ukraine reached the record volumes, which became the second one since the maximum index in 2008 (2.9 mln tonnes), which totaled 2.3 mln tonnes, according to estimations of APK-Inform Agency. Growing of the oilseed production was mainly caused by low share of winter rapeseed losses, and the increase of its yield.
Taking into account that the share of winter rapeseed dominates in the oilseed production, then there should be mentioned its high dependence on the weather conditions. The planting campaign for the harvest-2013 was held at sufficiently favorable weather conditions, which also continued in the winter period, which resulted in rather low share of the oilseed losses (nearly 10%). Therefore, the harvested areas of rapeseed (winter and spring) totaled 996.7 thsd ha (the planted areas - 1.08 mln ha), while in 2012 the index totaled 547 thsd ha only in the terms of the planted areas of 1.06 mln ha. It should be noted that in the current season the yield also increased to 2.3 t/ha, against 2.2 t/ha in 2012/13 MY.
To date the processing capacities in Ukraine allow to process the whole volume of rapeseed produced in the country, but sunflower seed is still the main raw material for oilseed processing in the country. Also, we should note that during several recent seasons Ukraine increased the rates of soybean processing, but rapeseed is still the outsider.
But due to the growth of rapeseed production volumes in the current season, there is also expected the growth of its domestic processing and exports.
According to our estimations, the processing volume of rapeseed will increase to 130 thsd tonnes, and the production of oil - to 55 thsd tonnes.
In the terms of the growth of rapeseed processing volumes Ukraine also showed the high export volumes of rapeseed oil and meal, which during 5 months of the season reached 46.2 thsd tonnes and 59.5 thsd tonnes, respectively. In the reporting period Portugal (36%) and the Netherlands (24%) became the main buyers of Ukrainian rapeseed oil, Spain (28%), Israel (22%) and Lithuania (19%) - the buyers of Ukrainian rapeseed meal.
Rapeseed in Ukraine is the export-oriented agricultural crop. Thus, nearly 95% of the total supply of rapeseed in the country comes on foreign markets. The absence of export limitations, and the low demand of domestic oilseed processors contribute to development of rapeseed exports.
According to estimations of APK-Inform Agency, in July-November period of 2013/14 MY Ukraine already shipped 1.9 mln tonnes of the oilseed on foreign markets, which exceeded the annual volumes of the previous four seasons. We should also note that since the beginning of the season rapeseed exports monthly reached the record indices. In July the country exported the record volumes for the reporting month - 215 thsd tonnes of rapeseed, in August - 577 thsd tonnes, in September - 474 thsd tonnes, in October - 519 thsd tonnes. In November the export volumes totaled 148.8 thsd tonnes, which also became rather high index for the reporting month.
As a result, basing on the export potential of rapeseed in 2013/14 MY (2.1 mln tonnes), and the current rate of exports, in December-June Ukraine may supply nearly 200 thsd tonnes of the oilseed on foreign markets.
In the first half of the season Ukraine supplied rapeseed to more than 20 countries. At the same time, the major volumes of the oilseed were traditionally supplied to the EU - the leader in the production and consumption of rapeseed and rapeseed oil in the world. So, during 5 months of the current season Ukraine already shipped more than 1.4 mln tonnes of the oilseed in the reporting direction, or 75% of the the general exports from Ukraine. At the same time, in the reporting period France (437.4 thsd tonnes, or 23% of the general export volume), the Netherlands (358.6 thsd tonnes, 19%) and Belgium (213.6 thsd tonnes, 11%) became the largest importers. These three countries purchased 52% of the supplied volumes from Ukraine.
At the same time, in the first half of the season there was observed the significant growth of Ukrainian rapeseed purchases by South Asian countries, due to the increased imports of Pakistan. Thus, in July-November of the current season Pakistan imported 222.7 thsd tonnes of the oilseed of Ukrainian origin, whereas last season the country imported 4.8 thsd tonnes of the oilseed only. Also, we should note some increase of the imports by the Middle East countries. Increasing of the oilseed imports in the reporting region was caused by the significant increase of rapeseed imports by the United Arab Emirates. During the whole 2012/13 MY the country purchased 38.5 thsd tonnes of Ukrainian rapeseed, but during 5 months of the current season Ukraine already shipped 133.6 thsd tonnes of the oilseed to the country.
Since the world market shows high demand in Ukrainian rapeseed, many companies have interest in working on the oilseed market. Therefore, nearly 120 companies export rapeseed from Ukraine, many of which form parts of large-scale agricultural holdings and multinational companies.
In July-November of 2013/14 MY the companies Nibulon (21% of the general supplies), Serna (13%), Alfred C. Toepfer (13%), Cargill (6%) and Suntrade (3%) became the major companies-exporters of Ukrainian rapeseed.
Ukraine mostly imports seed material of rapeseed. So, Ukraine imported 2.3 thsd tonnes of seeds for the harvest-2014, or 17% of the required volumes. During recent years in Ukraine there is observed the trend of increasing of the share of imported seeds in the general volume of seed material.
In conclusion, we should note that despite all risks in the process of rapeseed production, its high liquidity and attractive prices will be the key factor in stimulating the further production of the oilseed in Ukraine. The high demand on the world market and the absence of limiting measures on the oilseed exports will assist to ensure that in the short term prospect rapeseed will continue remaining the main export crop among oilseeds, and the domestic processing will remain at fairly low level.
oilseed market analyst of APK-Inform Agency
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