MarketsFarm – ICE Futures canola contracts held within a relatively narrow range during the week ended July 28, as traders wait to get a better handle on the size of the Canadian crop.
“We’re just waiting to see as we get into harvest what the crop size and crop yields look like,” said Jamie Wilton, commodity futures specialist with RJ O’Brien in Winnipeg.
General expectations are that the crop was down on the year, but the extent of the reduction remains to be seen.
“We’re largely priced in here now,” said Wilton. At current levels he said there was a risk of a downturn in the futures if yields start coming in above expectations.
However, on the other side “if (yields) are worse than expected, we’ll just resume higher,” said Wilton, “adding we’re in a holding pattern for now.”
Activity in the Chicago Board of Trade soy complex should provide some nearby direction for canola as well.