Canola futures may soon be due for a seasonal turn higher as harvest pressure subsides and prices look more attractive to end users.
While the market trended lower over the summer, MarketsFarm analyst Mike Jubinville said he expects farmer deliveries to soon lighten up, with the lows possibly in place for the time being. He placed chart support in the November contract at C$760 to C$770/tonne, with the close back above $800 on Wednesday a bullish technical signal - if the market can hold above that point in subsequent sessions.
Higher canola prices in the spring led to some demand destruction and an eventual downturn in the futures in June, but Jubinville said the situation has corrected itself.
“We are price competitive internationally again,” he said, noting that China was already thought to be in the market buying Canadian canola with movement to the country likely to pick up over the next few months.