Winnipeg/Commodity News Service Canada – ICE Futures Canada canola contracts moved higher during the week ended November 4, bouncing off of nearby support levels. However, the market remains range-bound overall with little to indicate a break outside of that range.
“These are just choppy markets,” said Ken Ball, of PI Financial in Winnipeg pointing to canola, as well as CBOT soybeans and corn. “We’re sideways; we’re choppy; there’s just no direction in any of these markets.”
He said a fundamental event will eventually happen to shake canola out of its sideways pattern, but that could be months away. “At the moment, the market is locked in a very tight range . . . it’s just a tug-o-war between buyers and sellers.”
Ball said the choppy back and forth activity in the market was keeping speculators from putting on large positions, as “you have to be in and out quickly . . . and a long hold, is a week.”
Ball said end users had little motivation to chase the market higher, given the relatively sizeable supply situation. While on the other side, harvest pressure has subsided and producers are content to hold onto their supplies for the time being.
“It’s just a battle between good demand and good supply,” said Ball.
From a chart standpoint, the January contract has found support over the past month around the C$471 per tonne level, while resistance comes in at C$485 to C$487.