The Star Online (03/09/2019) - LONDON: British farmer Charles Matts just harvested the worst crop of his life at one of the best times to sell it.
Rapeseed futures in Paris have jumped 9% from a low in early March. Yet Matts, like many growers across Europe, had little to sell after pests this summer chewed through half the rapeseed at his Northamptonshire farm. Even with the higher prices, farmers are debating whether to keep growing the difficult crop as the next planting period begins.
Rapeseed, easily spotted with its bright yellow flowers in summer, is used for meal and oil in products ranging from biofuel to mayonnaise.
Prices are trading at the highest for this time of year since 2013, after Europe collected its smallest crop in 13 seasons. European Union bans on certain pesticides have increased the threat of insect attacks, and farmers have been plagued by dry weather in recent years.
"Rapeseed over the years has been our most profitable crop, but it has the question of whether it will remain so,” said Matts, who also farms wheat, barley and beans. "We haven’t got a lot to sell.”
Parts of France are facing a dry spell as the planting period begins, similar to last year, said Nathan Cordier, a grains and oilseed analyst at Paris-based adviser Agritel. While it's still early, that may limit acreage gains in the EU's top producer, he said.
"Farmers are reluctant to plant a crop that’s going to be eaten”
With supply under pressure, prices could also benefit from the EU’s recent trade spat with Indonesia.
The bloc has raised tariffs on Indonesian biodiesel, mostly made from palm oil, which may boost demand for rapeseed oil to make fuel.
High prices typically lure farmers to increase plantings. Yet the difficulties growing rapeseed may lessen the appeal as sowing kicks off across Europe for the 2020 crop.
EU growers have struggled to control pests since a ban on neonicotinoids, insecticides linked to harming bees. The EU banned some neonicotinoids in 2013 for use on rapeseed, sunflowers and corn, and last year widened restrictions to usage everywhere except greenhouses.
While rapeseed plantings may rebound from last year, with prices more attractive than wheat, challenges protecting plants are among factors that could prevent large increases, Commerzbank AG agriculture analyst Michaela Kuhl said by email.
"Farmers are reluctant to plant a crop that’s going to be eaten,” said Owen Cligg, a trading manager at United Oilseeds in the U.K.
After this year’s bad harvests, Europe will also probably have to buy more than usual from other regions. Imports since July 1 have more than doubled versus the prior season, with nearly all the additional supplies from Ukraine, European Commission figures show. Canadian growers also aim to ship more to the bloc.
In the meantime, some farmers are switching to crops that can be interchanged with rapeseed. After Matts lost half of his latest rapeseed crop, he replanted with oats. For 2020 though, he is halfway through planting another rapeseed crop because it’s been profitable in the past and the alternatives are limited.
"We always think it’s going to be our last try, but we’re going to give it one more bash,” he said. "We’re optimists.” - Bloomberg
Read more at https://www.thestar.com.my/business/business-news/2019/09/03/eu-farmers-getting-fed-up-with-rapeseed-as-bugs-chew-crops#ye2uau5KmpCYcbW7.99