By Glen Hallick
Glacier FarmMedia – Canola futures on the Intercontinental Exchange were lower late Monday morning, with one analyst pessimistic about what he believes is likely to happen.
“We’ve had a great technical rally because the farmer is not selling,” the analyst said. “He’s thinking that because of Chinese purchases, they’re going to keep canola rocking and rolling to the upside.”
“I’m not convinced this (canola) market is going to go too much higher. The funds can only take it so high and then it runs out of steam,” he continued, warning “the farmer is thinking it’s going to be gravy towards spring.”
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However, the analyst suggested that China will now hold off on buying any more canola until the futures have dropped back, “probably when the funds get overbought.”
Canola was pressured by losses in the Chicago soy complex and MATIF rapeseed. As gains in Malaysian palm oil helped to temper the declines, a downturn in crude oil weighed on the vegetable oils.
The March canola contract remained above most of its moving averages, as it still lagged behind its 200-day average.
The Canadian dollar was higher on Monday morning, with the loonie at 73.04 U.S. cents compared to Friday’s close of 72.82.
Approximately 36,100 canola contracts were traded as of 10:41 am CST, with prices in Canadian dollars per metric tonne:
Canola Mar 647.30 dn 4.40
May 658.40 dn 4.20
Jul 664.60 dn 4.70
Nov 657.70 dn 5.30
To access the latest futures prices, go to https://www.producer.com/markets-futures-prices/.
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