By Glen Hallick, MarketsFarm
WINNIPEG, Nov. 1 (MarketsFarm) – Intercontinental Exchange (ICE) canola futures were higher on Tuesday, despite a sell-off in Chicago soyoil earlier this morning.
“Canola managed to percolate up,” a trader commented, noting the Canadian oilseed demonstrated a small amount of independence from soyoil.
He suggested the January contract could “kick higher” as soyoil remains well above 70 U.S. cents per pound, which in comparison made canola undervalued.
“But there are some forces out there trying to keep a lid on canola,” the trader warned.
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He said crush margins remain too exorbitant, that either they need to contract, or canola prices must improve in relation to product values. He stressed that despite a decent harvest this year, Canada still lacks sufficient supplies to meet any surge in demand created by those crush margins.
Support for canola was coming from strong upticks in Chicago soybeans, while soyoil was narrowly mixed and soymeal was easing back. European rapeseed and Malaysian palm oil were making modest increases. Sharp increases in global crude oil prices were spilling over into vegetable oils.
The Canadian dollar was a pinch higher with the loonie at 73.33 U.S. cents, compared to Monday’s close of 73.27.
Approximately 19,750 canola contracts were traded as of 10:33 CDT.
Prices in Canadian dollars per metric tonne at 10:33 CDT:
Price Change
Canola Jan 884.40 up 5.40
May 892.30 up 3.00
Jul 899.00 up 6.00
