(Resource News International) — Canola basis levels should remain strong over the next few weeks, but could start to deteriorate once more of the harvest is complete and producers increase their deliveries.
While old-crop canola supplies are large and new-crop production is starting to come off the fields, one canola broker thought exporters and domestic crushers were likely having some difficulties getting their commitments met due to the fact that farmers are wrapped up in the harvest.
The broker said farmers were putting most of the energy into getting this year’s crops off the fields, rather than making sales.
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“Every hour they can spend on the fields, they will,” he said.
The broker was advising his customers to take advantage of any good basis levels that are presented to them, “because sometime, about two or three weeks down the road, those basis levels will just disappear on us and they may not come back for a while.”
As an example of some of the strong basis opportunities currently available, Louis Dreyfus Canada, which operates inland terminals across the Prairies, has prices on its website showing spot basis levels as high as $5.06 per tonne over the November futures in southern Alberta.
Moving eastward, the Calgary company’s widest basis levels are found in southern Manitoba, where its terminals are currently offering basis levels in the area of $18-$19 per tonne under the futures.
