By Glen Hallick, MarketsFarm
WINNIPEG, July 5 (MarketsFarm) – Profit-taking was behind sharp declines in canola futures on the Intercontinental Exchange (ICE) at midday Monday, according to a Winnipeg-based trader. He suggested it could be someone who’s trying to depress the market or it could be commercial movement.
While the weather wasn’t a major driving factor today, the trader stated it will be again as canola crops are in bad shape in parts of the Prairies.
“In some areas the crop has pushed right through blooming,” he said, noting that if harvest begins before the end of this month “you know it’s a bad crop.”
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Unless there is sufficient rainfall, he said this year’s harvest could produce around 18 million tonnes. In turn that would result in furthering the issue with tight supplies. However, he said a crop of up to 21 million tonnes remains possible provided there’s rain.
In comparison, the 2020/21 canola crop came in at 18.72 million tonnes with nearly 19.61 million the year before, according to Agriculture and Agri-Food Canada.
Without guidance from the Chicago Board of Trade, as the United States markets were closed today to mark Independence Day, canola was left largely to its own devices. There was pressure coming from declines in European rapeseed, but there was support from moderate increases in Malaysian palm oil.
The Canadian dollar was slightly higher, with the loonie at 81.06 U.S. cents compared to Friday’s close of 80.95.
Approximately 9,000 canola contracts were traded as of 10:59 CDT.
Prices in Canadian dollars per metric tonne at 10:59 CDT:
Price Change
Canola Nov 803.00 dn 27.90
Jan 800.20 dn 25.00
Mar 790.40 dn 24.90
May 778.80 dn 24.50
