Prices 11/11/16

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Canola futures were dragged lower on the back of sharply lower soybean futures on Wednesday’s session. With soybeans staging a slight recovery last night and the S&D for canola still looking more bullish than bearish ICE futures for canola last night managed to take back the losses from the previous session and add some healthy gains.
Futures in Paris rapeseed also closed higher last night with gains of €3.00 on the nearby contract.
Timing a sale for canola may become a little tricky going forward as the Aussie dollar will play a major role in its price volatility. Yields and oil further south are exceptional so from a domestic supply scenario things are probably starting to shape up a lot better than most punters had expected a month or two back. This has seen some basis taken off the table over the last week. Globally the S&D for canola looks good with what was expected to be a big crop in Canada somewhat thwarted with an early winter and EU volume down in 2016. Going forward there has been significant increases in area sown across western Europe and the Aussie crop is better than expected so potentially this indicates a marketing program that would be initiated sooner rather than later depending on oil.
With canola values strong in relation to other grains it is likely farmers will unload it first to gain cash flow. This may also create a few shorts later in 2017 for those that decide to store.

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