Canola futures on the Intercontinental Exchange are being pressured by the harvest and a lack of export demand. One analyst said they could fall to their March lows.
Agriculture and Agri-Food Canada made several upward adjustments to its supply and demand estimates, after including the data from the Statistics Canada production update earlier this month.
As canola futures find some ground on the Intercontinental Exchange during the week ended Sept. 24, the Canadian oilseed’s path will soon be a steady decline. That’s the assessment from Tony Tryhuk, trader with RBC Dominion Securities in Winnipeg.
Expect canola futures to fall back in the coming months, said analyst Jerry Klassen of Resilient Capital in Winnipeg. Klassen pointed to the Statistics Canada production update and China as two reasons for the coming declines.
Harvest progress in Manitoba hit the halfway mark during the week ended Sept. 16, according to the latest crop report from the provincial agriculture department.
Speculative fund traders have moved to a net short position in canola futures for the first time in five months, according to the latest Commitments of Traders report from the United States Commodity Futures Trading Commission (CFTC).
The harvesting of all crops in Alberta reached 42 per cent complete as of Sept. 9, compared to the five-year average of 40 per cent. The provincial agriculture department noted combing was highlighted by little or no rain.
ICE canola futures recovered off five-month lows over the week ended Sept. 10, but were lacking any clear direction as the harvest picks up across Western Canada and trade uncertainty with China persisted.
Combining in Manitoba advanced 11 points during the week ended Sept. 9, which brought the harvest to 40 per cent complete provincewide, Manitoba Agriculture reported.