The monthly report released by the Grain Association of Western Australia (GIWA) shows that the expected rapeseed production in the state for 2025/26 has been comprehensively raised, reaching a new high in recent years, mainly due to the expansion of planting areas, favorable climate conditions, and smooth crop growth. GIWA expects the rapeseed production in Western Australia to be approximately 3.82 million tons, higher than last month's forecast of 3.33 million tons and an increase of 33.1% compared to the previous year.

The expected rapeseed production in Western Australia has been significantly raised to 3.82 million tons, a year-on-year increase of 33.1%, mainly due to the expansion of planting area, favorable climate, and smooth crop growth. A significant increase in supply will directly lower spot prices, creating a significant negative impact.

Rapeseed, as the main raw material for rapeseed oil, an increase in supply will reduce production costs, and it is expected that spot prices will come under pressure and decline. Based on the latest futures data, Zhengzhou Commodity Exchange contracts such as 2603 (closing price of 9,701 RMB/ton, down 18.00) and 2605 (closing price of 9,506 RMB/ton, down 19.00) have shown a downward trend, strengthening bearish expectations and further weakening futures prices.

The increase in rapeseed production will increase the supply of rapeseed meal, which will be detrimental to spot prices. The futures contracts of Zhengzhou Commodity Exchange, such as 2601 (closing price of 2,321 RMB/ton, down 7.00) and 2605 (closing price of 2,303 RMB/ton, up 6.00 but with weak overall trading volume), reflect price pressure, and the expectation of increased supply will exacerbate the downside risk of futures.

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