Glacier FarmMedia | MarketsFarm – In the week of trading in 2025, the March canola contract on the Intercontinental Exchange has stayed rangebound between C$615.90 to C$630.80 per tonne and a trader believes a lack of news to break the contract either way is to blame.
David Derwin of Ventum Financial in Winnipeg said canola prices began moving higher in December due to the Canadian dollar’s recent weakness as well as tightening supplies. However, they’ve hit a wall over the past week, staying mostly within the 20- and 50-day averages.
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“I think the Canadian dollar helped (lift canola) from below C$580/tonne to the C$620/tonne level. But at the same time, soybeans aren’t moving anywhere. They’ve been sideways. I think the same thing is true for soymeal, even though it’s been a bit choppy,” Derwin said. “It’s still the beginning of the year … There’s nothing dramatically bullish. We need some kind of new news.”
He said tariff talks between Canada and the United States and a change of view from China towards Canadian canola could become factors that could break canola out of its range. However, Derwin added there was nothing imminent in the short term.
One thing to watch for is soybean prices as a potential record harvest in South America gets underway.
“Soybeans are having a tough time breaking above US$10 per bushel and if soybeans drop lower, then it certainly won’t be a help to canola. (Soybeans) could drag canola down, for sure,” Derwin said.
The U.S. Department of Agriculture’s monthly supply/demand estimates and its quarterly grain stocks report as of Dec. 1, 2024 will be released on Jan. 10. However, Derwin said the reports at this time of year aren’t likely to affect canola prices.
The only thing that could get canola out of its range, Derwin said, is some sort of major news.
“We need something to capture the market’s focus and attention. So we’re in the status quo until we get something that forces (canola) to do something on a bigger scale.”
