The Whole Rapeseed Industry Chain Shrinks Rapidly due to a Decline in Domestic Supply

By CnAgri2017-05-02 10:37:07 Print

The rapeseed acreage in Yangtze river basin reduced sharply: more farmlands that originally grew rapeseed are abandoned in the Yangtze river basin this year due to the low profits, 10% - 30% of the farmlands are abandoned from southern Henan to Hubei, Anhui, Jiangsu; a considerable part of the rapeseed farmlands are replaced by wheat. New rapeseed output is expected to be around 5.6 million tons, down 11% year on year.

Currently the rapeseed is mainly crushed by small mills in the producing regions and the price is higher than the purchase price of oil plants. Although the temporary storage purchase policy is canceled, the price still remains high. After new rapeseed appears on the market, the price is expected to be around 4,500 RMB/ton, up 400 RMB/ton year on year.

Due to the continuous heavy losses in crushing, small mills are very popular. In recent years, the rapeseed crushed by the traditional mills accounts for nearly 60% of the output. More and more small and medium size oil plants close down in successive years, large oil plants turn to soybean crushing or other vegetable oil production, domestic rapeseed processing industry shrinks rapidly.

As a result, domestic rapeseed meal demand exceeds supply and rapeseed meal is constantly replaced by soybean meal, imported rapeseed meal, DDGS etc. If the industry continues to develop, after the breeding link starts to use a stable formula, it will be more difficult for domestic rapeseed meal demand to rise again. The recovery of domestic rapeseed industry will face more and more difficulties.