ICE weekly outlook: Canola steady heading into 2019

CNS Canada –– ICE Futures canola contracts held relatively rangebound during the week ended Wednesday, and should be expected to remain steady heading into the New Year barring outside political developments.

“We’re in a doldrums environment,” said Mike Jubinville of ProFarmer Canada in Winnipeg. “The supply/demand fundamentals suggest this market is reasonably well supplied, with good demand.”

While that should keep prices steady, there are a number of wild cards.

For one, Jubinville said, canola has been caught in the middle of the trade drama between the U.S. and China, and the uncertainty on that front was keeping some caution in the market.

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“If it was just about weather and supply/demand stuff, at least you’d have some confidence in the trend,” he said.

Looking at the January contract, he saw it in a range of $470-$490 per tonne for the time being.

While the canola supply/demand fundamentals are fairly supportive, “canola still has a soybean problem,” said Jubinville, adding large U.S. supplies and expectations for a big South American crop could limit any potential upside in canola.

— Phil Franz-Warkentin writes for Commodity News Service Canada, a Glacier FarmMedia company specializing in grain and commodity market reporting.

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