Cargill to close UK crush facility due to difficult market conditions

UK—Cargill has confirmed its intention to close its rapeseed crush facility in Hull in the UK ‘due to current market conditions’ which are thought to be a sharp drop in prices for rapeseed oil and rising costs.

Cargill’s plant in Hull, which has been operating since 1985, crushes rapeseed and specialty crops to extract crude oil and mid protein meal.

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The site, which has a daily capacity for 750 tons of seed, produces about 420 tons of rape meal and 323 tons of rape oil each day. It also has facilities to outload to barge export oil.

A Cargill spokesperson told Feddnavigator that the closure would impact 36 positions effective end of December 2022. “We are working closely with impacted employees and will be providing support throughout the transition,” they added.

The closure will be a notable loss to processing capacity within the UK, leaving just three plants; one in Liverpool, another at Erith in Kent, and a smaller site in Warwickshire.

Rapeseed area in Britain peaked at 756,000 hectares (1.87 million acres) in 2012 but totaled only 306,000 hectares for the 2021 harvest, according to government data.

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The UK in recent years has produced about half the 2 million tons required by its crushers. Traders said the sharp drop in production of rapeseed in Britain during the last few years had made it difficult for mills to obtain supplies from local sources and there has been an increasing reliance on imported supplies.

Warnings were made in 2020 about the possibility of losing a plant if domestic production continued at such low rates, owing to the loss of pesticides, yield issues and volatile input costs, according to April’s report from the Foreign Agricultural Service of the US Department of Agriculture (USDA).

UK spot prices collected by Farmers Weekly averaged US$881.34/t for oilseed rape on 10 June, down from US$889.51/t on 8 June.

Markets remain fairly bullish with tight supply expected to continue. However, good EU crop conditions and imports of canola from Canada could limit further growth, according to the Agriculture and Horticulture Development Board.

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