Traders reported growing signs of a tail-off in the buying spree which helped rapeseed prices nearly to E500 a tonne on the Paris futures exchange two months ago, and prices on the UK cash market to top £400 a tonne.
Cargill, the US-based agribusiness giant, "appears to be out of the market for August", with Archer Daniels Midland’s Erith facility, which consumes about half British rapeseed, "going the same way", a UK-based trader told Agrimoney.com.
Gleadell, the UK grain merchant, cautioned last week that "if farmers keep selling at the present rate we will very quickly exhaust all the July/August demand".
‘Armada of vessels’
Meanwhile, farmers over the weekend appear to have kept up their record of a "bonanza" harvest being enjoyed by all but the most easterly growers, on lighter soils, where crops suffered particularly during the spring drought, Mr Lane said.
"All the sun we have had seems to have made yields," he said, adding that the crop now looked like hitting 2.6m tonnes, some 20% above last year’s harvest.
In France, "recent harvesting progress confirms yields well above last year", Paris-based Agritel said.
The harvest results have eased concerns over the size of the European Union’s production deficit in 2011-12, and a crop in Ukraine, a favoured source of imports, where production looks set to fall 15-20% short of initially expectations of 1.7-1.8m tonnes.
Indeed, grain traders at a major European commodities house warned that "we may find the [rapeseed] market moves lower again" after a rash of orders which will see an "armada" of ships filled with oilseed leave the UK for the continent this week.
Imports from Australia?
However, Mr Lane added that contracts for the autumn were still showing strength, as price signals "do their job" of shifting demand later in the year, with the remainder of harvest to make fresh supplies available.
On the Paris futures market, November rapeseed added 0.6% to E430.50 a tonne, on a firm day for farm commodity prices, maintaining a premium over the February lot which added 0.6% to E425.00 a tonne.
Traders have attributed the premium over the February contract in part to the prospect for imports becoming available from Australia, where prospects for the crop in Western Australia have continued to improve.
*Separately, the UK-based Home Grown Cereals Authority said that palm oil "could be the abundant vegetable oil in 2011-12", with output increases forecast for Indonesia and Malaysia, the top two producing and exporting countries.
"As such, prices are at a large $160-a-tonne discount to soyoil and $257-a-tonne discount to rape oil," the HGCA said.