China’s rapeseed complex prices are skyrocketing

On Monday, the first day of trading after China imposed 100% duties on imports of rapeseed meal and oil from Canada, the Zhengzhou exchange saw prices for these products rise.

The most-active rapeseed meal futures rose 6 percent to 2,611 yuan a ton ($360), the biggest daily rise since September 2022. Rapeseed oil futures rose 5.2% to 9,213 yuan a ton ($1270), Reuters reported.

Exports of rapeseed oil, cake and peas from Canada last year were worth about $1 billion, according to China’s Customs Service, including 2 million tons of rapeseed meal worth $918 million and 15,300 tons of rapeseed oil worth $20.6 million.

“China has alternative sources of rapeseed oil, such as Russia and the EU, and an import duty hike by China could put pressure on Canadian canola prices, leading to a sharp decline in product prices,” said Anilkumar Bagani, head of research at Mumbai-based vegetable oil brokerage Sunvin Group.

According to OleoScope, rapeseed oil exports from Russia for the first 5 months of the 24/25 season amounted to 619,000 tons (+3% vs. 23/24 season), rapeseed meal – 258,000 tons. More than 90% of the product was shipped to China.

“It is also worth noting that China currently has large stocks of rapeseed oil and utilization of processing capacity is also high,” Baghani added.

Analysts have also raised concerns that the price rise may be temporary, as in the case of soybean complex: after a rapid rise of 3% on the back of the announcement of duties against the US, the markets showed a decline of 2.15%.

Tags: China, prices, Canada, rapeseed, restrictions