INDIANAPOLIS, Ind. – Canola oil is again selling at a premium to soybean oil, which could restrict the ability to expand canola acres in 2011, says an industry leader.
Canola oil sold at an 18 cents per pound premium to soybean oil a year and a half ago, said Tyler Groenveld, omega 9 market manager for Dow AgroSciences Canada Inc.
However, the premium evaporated over the past six months and canola oil sold for plus or minus a penny per pound compared to soybean oil, making it more attractive to American and global food companies.
Read Also
Interest in biological crop inputs continues to grow
It was only a few years ago that interest in alternative methods such as biologicals to boost a crop’s nutrient…
Groenveld said that presented a tremendous opportunity for Canadian canola oil exporters because it is easy to sell a product with a lower saturated fat profile than soybean oil when it is priced competitively.
However, the price premium has crept back lately and canola oil now trades at four to six cents per lb. more than soybean oil.
“That’s not bad,” Groenveld said.
“Of course, the narrower it is the better, the more opportunity there is for crushers to price competitively and ultimately to send the signals to the grower to plant more canola in North America.”
He said the premium is related to Canada’s fall weather problems.
