AMSTERDAM, Aug 22 (Reuters) - Rapeoil prices in Europe were expected toremain volatile in the near-term as the market digests the effect ofrecent bad weather and demand from the biodiesel sector, European traderssaid on Thursday.Nearby European rapeoil has gained around 13 percent since July 25 despitea pull-back in U.S. soyoil futures. September/October was offered onThursday afternoon at 545 euros per tonne fob exmill, up five fromWednesday evening.Bad weather has forced analysts to cut forecasts for global supplies ofrapeseed this season, but Europe would still see output rise by 300,000tonnes this season to 9.2 million and still have enough to export 700,000tonnes, industry newsletter Oil World said last week.Crop damage from the weather was not as serious as first expected withGermany's harvest seen unchanged and rains not hitting France's good crop,a German trader said."The German area was up so after the lower yield the harvest should beflat. There might be less in Sweden and Poland, but with a good crop inFrance there should be enough thoughout Europe," he said.Higher rapeoil prices was dampening demand from the biodiesel sector,leaving more for the food sector, the trader added. "These prices do notcalculate for biodiesel anymore, it's getting too expensive, so I thinkthey are taking less for biodiesel," he said.

STOCKS EDGE DOWN

There were conflicting accounts of how much supply was available asRotterdam stocks continued to edge down.A Dutch trader said many sellers were holding back, expecting furthergains in the market, but in Germany good volumes were reported to beoffered for September and October delivery."There's good interest especially for rapeoil, but there's a lack ofoffers," the Dutch trader said.Thin crushing margins in rape were inhibiting the market and players whoowned stocks were sitting on them, he added."For the nearby, for September and October, there is stock in the tank butthey are not willing to sell it," the trader said.Stocks of rapeoil in Rotterdam fell slightly this week by 756 tonnes butstill totalled 29,848 tonnes. They have plunged by more than half sincehitting a peak this year of 67,741 tonnes in May."There is no squeeze. Yesterday there were good quantities offered for thenearby although the consumption is mainly buying February/April now," theGerman trader said.But with the harvest now coming in and crushers gearing up, the stockscould start rising again, some traders said.