CNS Canada –– ICE Futures Canada canola futures saw only slight changes during the week ended Wednesday, as the market was stabilizing and watching weather ahead of harvest.
“If you go back for the three-odd weeks, we haven’t really gone anywhere. We’ve sort of chopped around in a range but it’s certainly not like we’ve really gone anywhere,” said Jon Driedger of FarmLink Marketing Solutions. “It’s maybe a matter of the fact that I think the crop for the most part has stopped getting smaller.”
Weather is going to continue to be a focus, but markets are struggling to find direction as conditions remain variable across the Canadian Prairies.
“There are some areas where it’s dry and needs some rain, and there are some areas, for example, (the) Peace River region, where the crop is patchy and struggling,” Driedger said.
“And in some other areas the warm weather has helped pull it (the crop) along if it was late.”
Going forward, prices will likely remain fairly rangebound, trying to make time until producers get out into the fields and start to get better ideas on how big 2014-15 Canadian canola production will be.
If Chicago soybean futures drop, there is a potential for canola to be pulled down along with them, Driedger said. There’s further downside potential in soybeans if good weather continues in the U.S. Midwest until harvest, he added.
Traders will be watching the production and stocks figures for soybeans in the Tuesday’s (Aug. 12) monthly report from USDA, as they have the potential to provide directions for North American oilseed markets, Driedger said.
Canadian canola production estimates will be released on Aug. 21 by Statistics Canada, but won’t likely be given much weight.
“The August one is a report that gets taken a little bit with a grain of salt,” Driedger noted. “And I think part of that is really a function of the fact that no one’s really getting into the fields yet.”
— Terryn Shiells writes for Commodity News Service Canada, a Winnipeg company specializing in grain and commodity market reporting.