North American markets may be a little light on for data today with a holiday in Canada and some parts of the USA. We also have a WASDE report out overnight. The punters were mainly in squaring up mode at the futures markets. We also have some bearish pressure from outside markets and the stronger AUD.
A continued reduction in the Chinese crush volume for soybeans is probably the major fundamental news to watch in the short term. Although canola oil demand in many cases is not substitutable demand, weaker soybean prices do generally spill over into the complex resulting in softer canola values. As was the case last night.
The USDA had predicted an increase in Chinese crush volume of 4% this year but at present the four week average is 14% below the 2020 volume. Current crush volume is tracking closer to 2019 volume which will not help US ending stocks. Time will tell if this is just a continued hangover from hurricane Ida or if China is indeed reducing meal production and using alternative feed stock as they suggest.
On the flip side, there’s always a flip side, we see stronger energy prices potentially offsetting the downside pressure for beans and corn.

The AUD is likely to spoil the show here today. The move in the AUD / CAD is worth a AUD$6.00 hit to canola values regardless of the weaker futures. Paris rapeseed was off €17 on the nearby contract overnight. That converts to about AUD$26.75 per tonne. So combining the hit in futures, currency and the spill over pressure from Chinese demand for soybeans, canola could get bumpy.