Russian gov renews temporary ban on rapeseed exports, extends bean duty

The Russian government has renewed a temporary ban on rapeseed exports until February 28, 2023, which amid a record rapeseed crop in the country, will lead to an increase in rapeseed processing and rapeseed oil exports, according to local Russian media.

The ban on the export of rapeseeds was extended to protect the domestic food market and load domestic production capacity with agricultural products.

The previous ban was in effect from March 31 to August 31, 2022.

According to US Department of Agriculture (USDA) estimates, rapeseed production this season will be a record 3.9 million mt over the past 10 years, which is 40.5% more than last year.

Given the record harvest and the ban on rapeseed exports, market sources suggest there will be an increase in rapeseed processing volumes of at least 30%.

According to USDA estimates in August, rapeseed processing during the 2022/23 season will increase to 3.05 million mt, which is almost 33% higher than last year, resulting in a 24% increase in rapeseed oil production to 1.2 million mt.

An increase in rapeseed production and a ban on its export increase the export potential of rapeseed oil in the 2022/23 season to 1.1 million mt, which is almost 16% higher than last year and is a record value, according to USDA estimates.

According to Russian customs statistics, the main buyers of rapeseed oil were EU countries and China, but Russia's invasion of Ukraine led to the refusal of the Russian product by some European buyers.

However, the Chinese market remains one of the main destinations for Russian rapeseed oil, with market sources suggesting an increased supply of rapeseed oil from Russia to China already at this stage.

According to the customs statistics of foreign trade of the Russian Federation, in the 2021/22 season exports of rapeseed oil to China amounted to about 330,676 mt, which is just over 44% of the total export volume.

The temporary restriction will not apply to the export of rapeseed to countries of the Eurasian Economic Union (EAEU) – Abkhazia, South Ossetia, Donetsk, and Lugansk People's Republics – according to the website of the Russian Cabinet of Ministers.

In addition, the ban will not affect the export of rapeseed within the framework of international intergovernmental agreements and the provision of humanitarian assistance to foreign states.

The government also extended the export duty on soybeans until August 31, 2024, while the rate will remain at 20% or at least $100/mt.