Consultancy Strategie Grains has raised its forecast for this year's European Union rapeseed harvest while trimming demand expectations, projecting reduced supply tightness next season.
Rapeseed production in the 27-country EU is now expected to reach 17 million tonnes, compared with the 16.82 million tonnes forecast a month ago and 3.3% above last year's crop, Strategie Grains said in an oilseed report.
The upward revision was mainly because of Romanian output, the consultancy said.
Rapeseed is the biggest oilseed crop in the EU and used for making edible oil, biodiesel fuel and livestock feed.
A sharp fall in global vegetable oil prices between mid-May and mid-June cut margins for crushing oilseeds, including rapeseed, reducing demand prospects for the coming 2021/22 season, Strategie Grains said.
'We now forecast a recovery of rapeseed and sunseed stocks in the EU between the beginning and end of 2021/22 marketing year,' it said.
The consultancy made a slight cut to its forecast for EU sunseed output this year to 9.82 million tonnes from 9.88 million tonnes, but that would still be 13.2% above 2020's drought-affected crop.
Oilseed prices have surged this season, with Euronext rapeseed futures hitting record levels on tight global supply and strong demand fuelled by Chinese imports.
European rapeseed prices are expected to ease from current high levels in the run-up to harvesting, Strategie Grains said.
However, price trends will depend on yield results in Europe, prospects for Canadian canola and US soybeans in harvests later this year, as well as crude oil fluctuations that influence biofuel markets, the consultancy added.