ICE weekly outlook: Canola steady, awaits news

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

MarketsFarm — ICE Futures canola contracts moved lower during the week ended Wednesday, but remain rangebound overall awaiting some fresh market-moving news.

Some direction could come from the U.S. soybean complex, as the ongoing back-and-forth of trade talks with China could see some actual movement ahead of a Dec. 15 deadline that will see the U.S. impose new tariffs on Chinese imports.

Steady farmer selling has kept some pressure on the canola market, according to Keith Ferley of RBC Dominion Securities in Winnipeg.

Warmer temperatures across the Prairies were possibly bringing some farmer sales forward earlier, he said, as producers don’t want to be holding high-moisture grain on the farm.

Forecasts calling for temperatures to drop over the next week may limit country movement and underpin prices.

Statistics Canada releases the results of its final production survey of the year on Friday, and any surprises in the data could sway the canola market.

While many traders anticipate an upward revision to the 19.4 million-tonne forecast in September, Ferley felt the poor harvest conditions would lead to a smaller crop.

“There are still bushels in the field and every bushel that was there in September might not be there in April when you go to take it off again,” he said.

— Phil Franz-Warkentin reports for MarketsFarm, a Glacier FarmMedia division specializing in grain and commodity market analysis and reporting.

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