ICE Canola Weekly Outlook : Falling Market Looks for Support -November 01, 2023 at 05:12 pm EDT
WINNIPEG, Manitoba–The ICE Futures canola market continued its months-long downtrend as the calendar flipped over to November, and the futures are looking for an outside catalyst to spark a corrective bounce.
While canola has seen occasional attempts at correcting higher over the past two months, any gains proved short-lived.
“The oilseeds are very swingy and erratic right now,” said Ken Ball, of PI Financial in Winnipeg, adding that “canola is struggling to hold.”
Speculative money was on the short side, he said, and fund traders were showing little interest in exiting bearish bets or going long for the time being.
From a fundamental standpoint, “canola is fairly cheap,” Ball said, pointing to the wide crush margins and steady domestic processor demand.
However, he added that while canola may be attractively priced “that doesn’t mean people are rushing to buy it.”
After losing nearly 150 Canadian dollars per metric ton over the past two months, Ball said he anticipated canola could be near its harvest lows.
“It’s a bit of a mystery why (canola’s) not attracting more interest.”
While he expected a bounce in canola was inevitable, “it will need a bit of help … (and) we may just stay sideways and listless for a while.”
Gains in Chicago soyoil would be one possible supportive influence, with any weather concerns in South America also having the potential to support canola.
Ball said that while the conditions in Brazil and Argentina weren’t perfect, soybean crops there were getting enough precipitation for the time being, which was limiting the potential any spillover weather-related support.
Source: MarketsFarm, [email protected]
(END) Dow Jones Newswires
11-01-23 1711ET
