Glacier FarmMedia | MarketsFarm—The Intercontinental Exchange (ICE) Futures canola market tried to salvage what it can at the end of July after a sharp downturn in prices over the past week.
While the November contract gained C$6.20 per tonne during the day of July 31, the price was still down C$47.70 from the week before at C$623.90.
Winnipeg-based analyst Bill Craddock said that an influx of funds selling canola short brought the oilseed down in the midst of bearish yield projections. Weakness in the Chicago soy complex also contributed to canola’s losses.
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However, he was a bit nonplussed as to why the oilseed was trying to make a recovery. Nevertheless, he believes crop conditions could be the cause.
“We lost crush value after (canola was) the lowest in quite some time. I’m not quite sure what the rationale (was),” Craddock said. “I really don’t see anything other than the (canola) crop might not be as great as people think it is … Canola is still looking good, but the majority of the fields are green. But there are still some fields that are 20 to 30 per cent flowers.”
Craddock also observed that early canola fields seemed to withstand excess moisture much better than late fields.
“My opinion is that it will be C$40 per tonne lower when it’s closer to harvest,” Craddock said.
