Global Rapeseed Production Insufficient to Cover Consumption

(UFOP/Biobased Diesel Daily) In view of a decline in production area and anticipated lower yields, the International Grains Council expects world rapeseed production in 2024-’25 to fall short of the previous year’s level.

The IGC recently projected production to reach 87.2 million metric tons, representing a 2 percent drop from the previous season.

In other words, the IGC revised its previous month’s forecast down 900,000 tons.

Following a sharp drop in the previous season, production is expected to continue decreasing in the current crop year.

Australian production is currently projected at 5.4 million tons, around 700,000 tons less than forecast in May and 4.5 percent below the previous year’s level.

At 4.9 million tons, Ukraine is anticipated to harvest around 500,000 tons less than previously expected.

The country has seen quite changeable weather, with favorable conditions during the winter months followed by dry spells and extreme heat in recent weeks.

Excessive rains, waterlogging and pests impaired crop development, especially in France, Germany and the U.K., thus limiting the yield potential.

As a result, production in the EU is currently seen at 18.7 million tons, which would translate to a 5.1 percent decline on a year earlier.

In the light of lower global rapeseed supply, global consumption is also expected to decline in 2024-’25.

At 88.7 million tons, demand is seen to be around 0.5 percent down on the previous year and 800,000 tons below the previous month’s level.

According to investigations conducted by Agrarmarkt Informations-Gesellschaft (mbH), with world production projected at 87.2 million tons, this would mean a global supply shortfall of 1.5 million tons.

Against this background, end-of-year stocks are likely to decrease more sharply than previously expected.

At 5.6 million tons, the amount of rapeseed in storage would be as much as around 21 percent smaller than it was the previous year and 1 million tons smaller than forecast last month.

In view of the IGC forecast, the Union zur Förderung von Oel- und Proteinpflanzen e.V. (UFOP) said it expects strong to rising prices at the time of sowing this year and advises farmers to plan rapeseed production areas to meet the crop rotation requirements on their farms.

Demand for rapeseed oil in biodiesel fuel and future renewable diesel production is supported by the discontinuation of the option of crediting palm oil-based biofuels towards greenhouse-gas reduction obligations in Germany and other member states, including France and Sweden.

The association has highlighted that demand from the biofuels industry has a strong influence on rapeseed acreage and therefore also crop-rotation diversity.

According to UFOP, this fact also safeguards the availability for the purpose of food supply, because the final use is always in the food market with its high willingness to pay. READ MORE / MORE (PDF)

Excerpt from Bloomberg/American Journal of Transportation: Chevron Corp., crop trader Bunge Global SA and seed company Corteva Inc. just wrapped the first season of their joint program that encouraged Tennessee and Kentucky farmers to sow a winter crop of canola before planting soy or cotton. It went so well that they plan to expand acreage sevenfold in the next season starting this fall and expand into three additional states: Illinois, the top US soybean producer, as well as Indiana and Missouri, Corteva said.

Farther west, grain handler Scoular Co. is spending tens of millions of dollars to convert a former sunflower processing facility into one capable of crushing canola, soybeans and other oilseeds starting in October. Chevron and Bunge’s own flexible plant meant to handle a wide-range of oilseeds, including canola, is set to start operations in Louisiana in 2026.

“This is very new to a lot of people in our area,” said Kentucky farmer Jed Clark, who planted canola this past winter for the first time after signing on with the Chevron-Bunge-Corteva project. “Some of these types of crops can be come-and-go, but this seems like it will have longevity given the corporate support behind it.”

As the world prepares to trim its dependence on fossil fuels in the heavy transportation sector, producers of all varieties of oilseeds — from dominant soybeans to little-known pennycress — are jostling to become a feedstock of choice for climate-friendly jet fuel and diesel. Although renewable diesel and aviation fuel are still in the early stages of development, the markets are on track to grow fast.

That is, unless Donald Trump wins November’s US presidential election and looks to water down incentives to decarbonize the sector, which some see as a distinct possibility. On the other side, some critics of Biden’s administration had worried he’d champion electric vehicles at the expense of biofuel growth, despite his support for the sector. If Vice President Kamala Harris becomes the Democratic nominee, she’s likely to face similar scrutiny given her state of California’s ambitious goals to slash fossil fuel emissions and move to EVs. READ MORE