CNS Canada — ICE Futures Canada canola contracts moved off of chart support during the week ended Wednesday, to hit its highest levels in two weeks.
However, the market remains rangebound overall, as traders wait to get a better handle on the size of this year’s crop.
With harvest operations just starting, Jamie Wilton of R.J. O’Brien in Winnipeg expected canola would remain trading in its sideways range, reacting to yield reports as they come in.
He placed support at about $490 per tonne in the November contract, with resistance at $515.
A lack of significant farmer selling for the time being, tied with an equal reluctance from end-users to enter the market, contributes to the rangebound sentiment in the canola market.
Statistics Canada releases its first survey-based production estimates of the year on Aug. 31, and any surprises in the report could provide some direction for canola.
Canada grew 18.4 million tonnes of canola in 2016-17, and pre-report estimates for 2017-18 range widely, with some industry participants expecting a sizeable decline and others a large increase.
Wilton said activity in the Canadian dollar also has the potential to provide some nearby direction for canola.
— Phil Franz-Warkentin writes for Commodity News Service Canada, a Winnipeg company specializing in grain and commodity market reporting.