Glacier FarmMedia — ICE canola futures recovered off five-month lows over the week ended Sept. 10, but were lacking any clear direction as the harvest picks up across Western Canada and trade uncertainty with China persisted.
“I think we’re in a range,” said Calgary-based analyst Errol Anderson, placing support in the November contract at C$600 per tonne with the top end at C$660 “if the soybeans can gain some momentum.”
November canola settled at C$628.10 per tonne on Sept. 10.
He expected much of the direction in canola would come in response to the soy market, noting that if China continues to stay away from the North American market soybeans could fall below US$10 per bushel. “If that happens, canola will test the C$600 level,” said Anderson.
Beyond the day-to-day fundamentals, Anderson said outside geopolitical developments could sway the commodity markets — including canola.
He was watching for deflationary signals, with expected rate cuts from central banks possibly the signal that would send equities off their highs with base commodities already starting to see price drops.
