ICE Canola Midday: More double-digit declines
Analyst notes feds' inaction
By Glen Hallick
Glacier Farm Media MarketsFarm – Intercontinental Exchange canola futures continued to drop back on Wednesday, due to China’s announcement of it launching an investigation into canola dumping by Canada.
China’s move is in retaliation for Canada imposing a 100 per cent tariff increase on imports of Chinese electric vehicles, as well a 25 per cent hike in imports of its steel and aluminum.
“Ultimately I think this [canola] tariff is coming and it will take years to resolve,” an analyst commented, noting the projected five million tonnes of canola exports to China in 2024/25 very likely will fall quite short.
He stated the canola market needs to redirect itself to Japan, Mexico and Europe in order to compensate for the loss of business to China. The analyst lamented that it appears the Canadian government, aside from paying lip service to canola growers, is set to do very little to financially assist them.
Also, he projected this year’s canola crop to come in below 19 million tonnes due to smaller than expected yields. Last week Statistics Canada forecast a canola harvest of 19.5 million tonnes.
Additional pressure on canola came from declines in Chicago soyoil, European rapeseed and Malaysian palm oil. Small losses in crude oil helped to push oilseed values lower. Upticks in Chicago soybeans and soymeal attempted to put a lid on further declines in canola.
The Canadian dollar was pushing higher by late Wednesday morning, with the loonie at 73.98 U.S. cents compared to Tuesday’s close of 73.81.
Approximately 36,100 canola contracts were traded as of 10:35 am CDT, with prices in Canadian dollars per metric tonne:
Price Change Canola Nov 571.30 dn 19.60 Jan 583.80 dn 19.20 Mar 593.80 dn 18.90 May 603.70 dn 16.30
