Canola prices surge amid tough seasonal conditions

Canola prices have jumped $200 a tonne compared to a year ago, but many farmers still face poor yields. See how prices are stacking up.

Canola prices have surged to levels up to $200 a tonne more than they were at the same time last year, but some farmers say it’s still not enough.

Dry conditions in Europe and North America combined with conflict in the Middle East and the recent US air strikes in Iran are being identified as contributing factors.

But southern farmers say even with the higher prices, they just may not have good enough yields to cash in.

Southern Riverina grower Rob Massina from Finley, NSW, said he forward-sold some canola this week, delivered to Tocumwal, for about $800 a tonne.

“If we were sitting here this time last year and having this same conversation, we would be looking at $600 a tonne,” he said.

“What do you do? I guess you take the opportunity at the time.”

While he was confident enough to lock in a small portion, he noted the canola crop was generally slow and behind schedule compared to its usual progress.

“I have started top dressing some of it, and some of the crop is better than other areas,” he said.

Mr Massina said the higher prices were not to be taken for granted and there had been market volatility.

“In this area, canola was at $840 a couple of days ago, then yesterday it got down to about $807. I think we will see this kind of volatility continue,” he said.

In the past week, he received a welcome 21mm of rain and said crops were sown earlier into dust.

“I was standing here a month ago wondering what was going to happen.”

Richard Jennings of Berry Jerry in southern NSW pictured in his crop of canola. Picture: Nikki Reynolds.

Meanwhile, Cargill has reported that domestic canola price rises are due to tight supply and strong export demand.

The major grain merchant and agribusiness said there was very little unsold stock in growers’ hands.

Rupunyup grower Tess Healy said some of the canola at her place had, in fact, been resown with barley.

“I think we have less skin in the game with canola,” she said.

“We had a really strong germination, and then there was no follow-up rain, and we had frosts,” she said.

Ms Healy said growers would be looking for the higher prices due to the difficult season.

Southern NSW grower Richard Jennings from Berry Jerry said his canola was about a month later than usual.

“The later sown canola that had moisture is at the same stage as the canola that was sown dry,” he said.

“We are behind, and this is uncharted territory for us when you look and compare a regular canola season.”

Even though the price was substantially higher than what was being offered at this time last year, he still didn’t think it would totally offset the challenges of a difficult year and potentially lower yields.

“This is just going to be a pretty average crop,” he said.