Uruguay Rapeseeds: The UK and France Emerge as Key Markets


Mar 31, 2023 | Agricultural Markets News

Reading time: 2 minutes

The Ancap Group’s company, Alcoholes del Uruguay (ALUR), completed the export of 5,000 tons of canola oil and some 700 tons of soybean oil to Chile, in addition to 3,700 tons of biodiesel to Peru. The logistics operation is carried out through more than 30 tanker trucks that leave ALUR’s Capurro Industrial Park towards the port of Montevideo for their subsequent transfer by ship to both member countries of the Pacific Alliance.

The Ancap Group expressed through its official Twitter account that “these exports are part of the reorientation of the oilseed business” and that they “are achieved thanks to the commitment and professionalism of our people.” On December 30, 2022, Ancap announced that ALUR had closed the placement of 4,000 tons of canola biodiesel produced in the Capurro Industrial Park destined for the European Union for around 5 million dollars.

According to the state company in Capurro “vegetable oils and animal fats are processed that give rise to biofuels.” In addition, this shipment was highlighted as “one more step towards sustainability by the Ancap group company” in its operations with oilseeds. “Uruguay and Canada are the only countries in America that grow oilseeds in large areas,” ALUR president Alfredo Fernández Sívori told the press, who highlighted the country’s ability to harvest against the northern hemisphere, where the product is highly required as it tolerates temperatures below 10 degrees and can be converted up to 40% into the oil.

The hierarch considered that the current infrastructure available to Ancap is adequate. However, as this business unit grows as expected, a more significant number of tanks will be necessary at the La Teja refinery and a pump with a greater flow to materialize exports to Europe. In recent years, one of the most notable changes in Uruguayan cropping patterns has been the adoption of Rapeseed. For many years Rapeseed plantings were limited to land contacted by ALUR, and there were few opportunities to export the crop.

Most farmers and agronomists lacked familiarity with best management practices, and Rapeseed was considered a niche crop. However, in recent years, growing demand and knowledge diffusion have led to the widespread adoption of Rapeseed into crop rotations. From an agronomic perspective, Rapeseed provides a yield boost to second-crop soybeans compared to traditional winter cereals like wheat. It allows using different herbicides than wheat or barley, leaving less residual material. Because it can be harvested earlier than wheat, it enables for the earlier planting of second-crop soybeans.

Uruguay Rapeseeds Export Application

From a commercial perspective, Rapeseed is attractive because farmers can effectively use the MATIF/Euronext futures to hedge their position. In barley, farmers can sign contracts with maltsters to establish price certainty, but in wheat, there is no suitable mechanism for farmers to do so. Export demand for Rapeseed has also driven more extensive plantings, with the UK and France as crucial destinations. Uruguayan farmers accustomed to meeting quality standards that other origins may find onerous have found success producing Rapeseed for European markets, which don’t permit the use of paraquat and several other commonly used agrichemicals. Additionally, to comply with the demands of these markets, Rapeseed grown in Uruguay is not genetically engineered.

While Rapeseed is expected to continue expanding in coming years, its total acreage is limited due to a need to wait two seasons between each planting cycle. Thus, the theoretical limit for annual Rapeseed planted acreage is one-third of the total winter crop planted acreage. This total winter crop area has trended upward from a low of around 380,000 hectares in 2017/18 to more than 530,000 in 2020/21. As sunflower acreage has stagnated and declined in Uruguay, Rapeseed oil has become increasingly important to the local crushing industry.

Other sources: AMBITO

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