EU: Oilseeds To Reach Record Levels
21 June 2007 Biodiesel accounts for 80% of the biofuels used in the EU. This has important implications for the vegetable oil market, particularly in terms potential shocks and price fluctuations. Currently, canola is the preferred feedstock for biodiesel, but there is an increasing trend in the use of sunflower and soybean oils.
In 2006/07, soybean production in the EU increased significantly as Romania became a new Member State in January 2007; Romanian soybean production is estimated to account for about one third of total EU soybean production. Romania used to be a big producer of genetically modified (GM) soybeans, but since accession to the EU, GM production is no longer legal. This has lead to a reduction in soybean production in the country to almost half of what it was prior to accession.
In 2007/08, EU-27 canola production is expected to increase by almost 14% to 17.75 MMT, mainly due to higher acreage. Some uncertainty remains on the yields, which may be negatively affected by the abnormally dry conditions in April. Roughly two-thirds of the EU-27 canola oil production is used for biodiesel, while the remaining third goes to food and staple use.
In 2006/07, total EU sunflower seed production will increase by 2,720 MMT due to the accession of the two new Member States. Romania is the largest producer of sunflowers in the EU, with an expected production of 1,500 MMT in 2006/07. However, in 2007/08, production is expected to decline by 603 MMT due to a decline in planted areas and dry conditions in France, Hungary, Romania, and Bulgaria. However, higher production is expected in Spain due better weather conditions and an increase in planted area.
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