Glacier FarmMedia — ICE canola futures have trended steadily higher for the past month, with more upside possible from a chart standpoint as market participants continue to account for easing tariffs from China.
March canola settled at C$650.20 per tonne on Jan. 28, having risen by about C$50 per tonne off its December lows.
“Ten to 20 dollars higher wouldn’t be out of the question,” said David Derwin, commodities investment advisor with Ventum Financial in Winnipeg. He placed the next upside targets for the March contract at C$660 and then again at C$670 per tonne.
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Derwin said China’s return to the market for Canadian canola ahead of reduced tariffs in March was supportive, with spillover from gains in soyoil futures in the United States also underpinning canola values. Seasonal price trends may also contribute to additional gains in canola, but Derwin said any movement above the nearby resistance points would take an outside catalyst.
Those outside forces could also easily send prices lower, with wider geopolitical developments, tariffs and developments in U.S. biofuel policy all potential market-moving influences.
“For now, it’s pointing higher and there’s a little more room here,” said Derwin on canola.
