The USDA has suggested that the Ukraine rapeseed crop in 2017/18 was a whopping 83% bigger year-over-over.
Just how much of that 2.2 million tonnes is getting exported though?
It turns out quite a bit. But there are reasons why.
The USDA’s attache in Kiev recently noted that “recent changes in tax legislation and excess crush capacity will likely encourage additional processing activity and lead to higher exports of processed products (oils and meals)”.
The tax policy change is more favourable to soybean players but there could be more Ukrainian rapeseed getting crushed domestically, despite its strong export activity.
On that front, so far, the Ukraine rapeseed crop has exported 2 million tonnes, effectively doubling its rapeseed shipments made in 2017/18.
Total oilseed exports out of Ukraine so far in the 2017/18 marketing year are sitting at 3.67 million tonnes, or 48% better than the same time a year ago.
It’s worth noting that Ukraine might not be able to play ball whatsoever in the new European biodiesel game. As noted earlier today, palm oil is out in the EU as a source of biofuel, which opens the door for the likes of rapeseed and canola-based biodiesel.
Since ending stocks from 2017/18 were literally just 24,000 tonnes, Ukraine rapeseed inventories are clearly becoming depleted. The USDA attache is currently estimating that Ukraine’s 2017/18’s ending stocks will come in another low number of 22,000 tonnes.
In our opinion, this should open the door for elevated Canadian canola exports to the EU.