By Dave Sims, Commodity News Service Canada
WINNIPEG, April 4 (CNS) – Canola contracts on the ICE Futures Canada platform were lower on Wednesday, following a sharp selloff in U.S. soybeans.
China’s decision to impose a 25 per cent tariff on soybean imports sent U.S. soybean futures plunging. The penalties don’t kick in right away leaving open the possibility of a settlement before the full effects are felt. However, the chances of the two sides coming to an agreement appear slim at the current moment.
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A crop estimate from Informa Economics pegged Brazil’s soybean production at 116 million tonnes, up one million from a previous estimate.
However, the Canadian dollar was slightly weaker relative to its U.S. counterpart, which made canola more attractive to domestic crushers and foreign buyers.
There are ideas that China’s trade dispute with the U.S. could heighten demand for Canadian canola. However, there are also theories that the lack of export demand on U.S. soy could pressure prices to a point where other countries snap them up and canola has no choice but to fall lower in price.
Prices in Canadian dollars per metric ton at 8:55 CDT:
