Winnipeg, May 27 – Canola crush margins have improved considerably over the past few weeks, to sit at some of their best levels of the past year.
Crush margins provide an indication of the profitability of the product values relative to the seed cost when processing canola, with exchange rates also factoring in to the equation.
As of May 27, the Canola Board Crush Margin calculated by ICE Futures Canada was at about C$107 above the nearby July contract, which compares with levels closer to C$84 a month earlier and the year-ago level of C$71.
“I don’t remember seeing (margins) at this level in some time,” said a market watcher.
With the end of the crop year fast approaching, and supplies tightening in Western Canada, he added that crush margins are likely to deteriorate in the coming months as end users will need to pay up for supplies.
In the meantime, the domestic crush pace continues to run at a record pace.
The weekly canola crush was a strong 179,485 tonnes, up 10.4 percent from the week before, said the Canadian Oilseed Processors Association.
Crush capacity use was almost 87 percent, topping the year average of 81.6 percent.
Canadian canola processors crushed 6.659 million tonnes of canola during the crop-year-to-date, up from 5.908 million at the same point the previous year, according to data from COPA.
