By Phil Franz-Warkentin, MarketsFarm
WINNIPEG, Sep. 20 – (MarketsFarm) –ICE Futures canola contracts were stronger at midday Tuesday, recovering from overnight losses as gains in Chicago soyoil and weakness in the Canadian dollar provided support. Malaysian palm oil and European rapeseed futures were also higher.
Canola crush margins have widened to historically large levels, indicating that processors are incredibly profitable, and canola is underpriced compared to its product values. The margin for October delivery came in at C$299 per tonne above the November futures on Sept. 19, which is up by nearly C$100 over the past month and compares to the year ago when margins were at C$28 below the futures.
Seasonal harvest pressure did keep a lid on the upside for canola, although scattered showers and the risk of frost in some areas will likely cause some delays over the next week.
About 20,500 canola contracts traded as of 10:37 CDT.
Prices in Canadian dollars per metric tonne at 10:37 CDT:
Canola Nov 797.80 up 11.20
Jan 806.60 up 11.40
Mar 813.60 up 11.30
May 817.50 up 13.30
