ICE weekly outlook: Canola mixed at midweek

ICE November 2020 canola with 20-, 50- and 100-day moving averages. (Barchart)

MarketsFarm — Canola contracts have stayed locked in a pattern for the past few trading sessions, with the July contract posting small gains and new crop year contracts showing losses.

That’s mainly due to traders positioning ahead of July’s expiry date.

“It’s not uncommon for the July expiry to see some spreads swing around,” said Ken Ball of P.I. Financial in Winnipeg, adding that the strength in the July contract is keeping further contacts from incurring significant losses.

“Overall, canola is holding up reasonably sturdy,” he said.

Ball expected trade to remain “sideways” as traders wait to see how growing conditions will impact crops.

“The weather isn’t perfect,” he said, noting there isn’t much rain in the forecast for most of the Canadian Prairies.

The Chicago soy complex was lower to start the week, which prevented any significant gains for canola prices.

However, Ball said canola was “shrugging off” its negative influence. Nearby soyoil contracts were down half a cent Wednesday.

— Marlo Glass reports for MarketsFarm from Winnipeg.

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