Glacier FarmMedia — ICE futures canola contracts fell to their lowest levels in two months during the first week of August, with speculative long liquidation behind some of the selling pressure.
“It’s hard to rally any market without a crop threat … and we don’t have that,” said analyst Mike Jubinville.
The chart for the November canola contract was forming a “head and shoulders top,” which would be bearish from a technical standpoint. Jubinville said a settlement below C$670 per tonne in November canola would confirm the chart signal, with the next downside target in the C$610 to C$620 per tonne area.
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The November contract settled at C$669.70 per tonne on Aug. 6. That put the market below its 100-day moving average for the first time in four months.
However, while the technical uptrend may be broken, he expected such a large drop was unlikely and noted that the underlying fundamentals remain supportive for canola. Solid demand over the past marketing year means that carryout stocks ahead of the 2025/26 harvest will be very tight, and even with good yields total supplies will remain tight in 2025/26.
Another factor to watch will be the latest threats against Russian oil exports by the United States, said Jubinville. If increased U.S. tariffs on importers of Russian oil, like India, lead to rising crude oil prices that could spill into vegetable oil markets.
