A Look at USDA's Global Rapeseed/Canola Data
The USDA's Oilseeds: World Markets and Trade report released today shows the forecast for global canola/rapeseed production increasing for a fourth consecutive month to a record 84.816 million metric tons (mmt) this month. This is up 1 mmt from last month, with this month's revisions including a 350,000 metric ton (mt) upward revision in the estimate for the European Union and a 659,000 mt increase reported for the "Other Category," largely due to increased output in Australia.
Given this increase, the overall balance sheet data seems a little puzzling, with global consumption increasing by 487,000 mt month over month, while ending stocks fell this month by 81,000 mt, from 7.244 mmt to 7.163 mmt, which must mean some adjustments were made to beginning stocks somewhere. Ending stocks at 7.163 mmt are up 64.3% from 2021-22 and the highest reported in three years.
The attached chart shows a sharp divergence in the stocks/use ratio for global rapeseed/canola at 8.9% (USDA data, blue line) and Canada's current stocks/use ratio of 2.6% (red line), based on AAFC's most recent estimates while measured against the secondary vertical axis.
The grey bars represent the average futures price for the crop year based on the ProphetX mean price from the continuous active chart. It is interesting to note that this average is calculated at $1,012.61/mt for the 2021-22 crop year, measured against the primary vertical axis. The yellow bar is based on Aug. 1- Nov. 9, 2022 calculation, at $849.20/mt, down 16% from the previous crop year, while canola prices continue to flirt with resistance at $900/mt.
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