MarketsFarm — ICE canola futures moved higher during the week ended Wednesday as a rally in the Chicago Board of Trade soy complex provided support.

Whether there’s more room to the upside remains to be seen.

“It looks like we’ve maybe turned a corner,” said Wayne Palmer, senior market analyst with Exceed Grain in Winnipeg.

Seeding delays and the possibility of yield losses for soybeans in the U.S. triggered the short-covering bounce, he said, but cautioned that more supportive news will be needed to continue the uptrend.

“If this thing doesn’t hold and we have a big down day before the end of the week, all bets are off on a long-term rally,” he said.

“It’s definitely technical right now,” according to Palmer, though he added it would just take a little spark to keep moving higher. He recommended farmers sell a portion of their new crop into the latest rally in order to get something priced, with the hope that the remainder will go for higher prices later in the year.

While the current short-covering rally may not last, he also expected the lows were likely in for the time being.

However, the lack of positive news on Canadian trade relations with China should remain a bearish influence. “It all depends on China and how this crop comes along,” Palmer said, adding, “this will be a year of volatility, and we haven’t seen anything yet.”

— Phil Franz-Warkentin writes for MarketsFarm, a Glacier FarmMedia division specializing in grain and commodity market analysis and reporting.